Military Conflict Causes $10 Million Weekly Loss in Sri Lankan Tea Exports

Sri Lanka's tea industry is facing disruptions due to military conflict in the Gulf region, causing estimated revenue losses of $10 million weekly. Exporters struggle with logistical issues and delayed payments, severely affecting trade, with 52% of exports destined for the affected Gulf states.

Sri Lanka's tea industry is grappling with severe disruptions due to an ongoing military conflict in the Gulf region, significantly impacting shipments to one of its largest export markets. Exporters are reporting a massive revenue loss of $10 million per week as logistical challenges and war risks hinder their ability to fulfill orders.

One key factor contributing to the crisis is the inability to utilize major shipping routes such as the Strait of Hormuz and the Suez Canal, as these are currently avoided by shipping lines due to the conflict. These routes are crucial for transporting approximately 52% of Sri Lanka's tea exports to the Gulf region.

The financial strain is compounded by significant payment delays for already dispatched shipments, intensifying cash flow issues for exporters. Despite brief openings in shipments to Turkiye, the overall trade is nearly stagnant, prompting the tea export association to seek government intervention to address outstanding payments from Iran under the Tea for Oil barter deal.

(With inputs from agencies.)