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Worsening Gulf Situation Could Immediately Strain Tea Prices, Industry Warns

Stakeholders in the tea industry have raised concerns about the escalating tensions in the Gulf, warning that the situation could have an immediate impact on Ceylon Tea prices. With over 50 percent of Sri Lanka’s tea exports heading to the Middle East, the industry is particularly vulnerable to any disruptions in the region.

The aftermath of the Red Sea attack has already affected the tea industry, resulting in longer delivery times and increased freight costs. However, additional issues such as airspace closures could exacerbate the challenges faced by tea exporters.

Ganesh Deivanayagam, Chairmen of the Tea Exporters Association, emphasized the potential strain on tea prices due to the deteriorating situation in the Gulf. He highlighted the risk posed to the industry’s stability and the livelihoods of those dependent on tea.

Echoing similar concerns, Jayantha Karunaratne, a veteran in the tea industry, stressed that developments in the Middle East have indirect yet significant impacts on tea exporters. He also expressed apprehension about potential trade sanctions affecting the industry.

Niraj de Mel, Chairman of the Sri Lanka Tea Board, acknowledged the industry’s concerns but stated that no major issues have been officially reported yet. Despite previous challenges, including the Houti attacks, there have been no significant disruptions to tea shipments or concerns raised by exporters.

The tea industry remains vigilant as tensions in the Gulf continue to escalate, recognizing the potential ramifications on prices and trade.

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