Sri Lanka’s premium high grown output has plummeted to levels not seen since 1992 El Niño as the national production has slipped. Brokers flag drought risks for early 2027.

Sri Lanka’s high grown tea production collapsed to a 34-year low in August 2026, underscoring the vulnerability of the country’s premium elevation teas to increasingly erratic weather patterns. Preliminary data from the Sri Lanka Tea Board, analysed by leading brokerage Asia Siyaka Commodities, showed High Grown output falling to just 3.1 million kilograms – the weakest monthly figure for this category since the severe El Niño-affected year of 1992.

National tea production for the month totalled 19 million kilograms, a 3.65 per cent year-on-year decline from 19.72 million kilograms in August 2025 and a steeper 10.97 per cent drop from 21.34 million kilograms recorded in August 2024, according to Forbes & Walker Research. The sharp contraction in High Grown and Medium Grown teas was only partially offset by a modest rise in low grown production.

Weather Extremes Drive Sharp Decline in Premium Elevations

Unlike the drought that devastated production in 1992, August 2026 was marked by excessive rainfall and persistent overcast conditions that severely limited plucking opportunities. Asia Siyaka noted that continuous cloud cover reduced solar radiation critical for tea bush growth, while heavy rain made field operations difficult across the central highlands where high grown teas are cultivated.

Forbes & Walker data revealed high grown output fell 16.17 per cent year-on-year to approximately 3.02 million kilograms, while Medium Grown production declined 14.77 per cent to 2.7 million kilograms. Low grown teas, which account for the bulk of national volume, rose 2.59 per cent to 13.09 million kilograms. Green Tea production edged up slightly by 0.17 per cent to 0.18 million kilograms. Asia Siyaka’s independent estimates closely mirrored these figures, putting total output at 18.9 million kilograms, down 3.7 per cent from the previous year.

The contrast with 1992 is stark. That year, a severe drought linked to El Niño saw high grown tea production plunge to as low as 2.2 million kilograms in April after months of sharply reduced rainfall. Meteorological records from the period showed roughly 46 per cent of the island receiving less than 10 per cent of normal rainfall between January and March. Asia Siyaka highlighted these historical figures to underline potential risks ahead rather than to draw a direct parallel with current conditions.

Cumulative Figures Show Modest Resilience Despite August Setback

Despite the August shortfall, cumulative production for January to August 2026 stood at 172.21 million kilograms, only 2.7 per cent below the 176.98 million kilograms recorded in the same period of 2025. High Grown output for the eight months was marginally higher, up 0.14 per cent to 37.35 million kilograms, while Green Tea rose 8.17 per cent to 1.74 million kilograms. Medium Grown production declined 6.21 per cent to 29.75 million kilograms and Low Grown fell 2.81 per cent to 103.37 million kilograms.

Compared with the corresponding period of 2024, total cumulative output was virtually unchanged, down just 0.16 per cent. High grown and green tea remained ahead of 2024 levels by 3.01 per cent and 16.45 per cent respectively, while Medium and Low Grown categories continued to lag. Asia Siyaka’s cumulative estimates broadly align, showing high growns slightly ahead at 38.3 million kilograms versus 38.1 million kilograms a year earlier.

By manufacturing method, Orthodox teas (the traditional whole-leaf process that dominates Sri Lanka’s premium exports) declined about 3 per cent year-on-year. In contrast, CTC (crush-tear-curl) production, typically used for tea bags, rose nearly 7 per cent, and green tea increased 8 per cent.

Brokers Warn of Potential Dry Spell Risks in Early 2027

Asia Siyaka used the 1992 precedent to flag possible challenges in the first quarter of 2027, when extremely dry and hot conditions are anticipated. The brokerage offered no forward-looking comments on the remainder of 2026, focusing instead on the stark difference between the current wet, cloudy conditions and the drought that previously hammered High Grown output.

Industry observers note that Sri Lanka’s tea sector has faced repeated weather-related disruptions in recent years. Production in 2025 had edged up only marginally to around 264 million kilograms despite earlier gains, constrained by reduced fertiliser use among smallholders and extreme weather events including Cyclone Ditwah in November 2025. High grown teas, which drive much of the country’s quality reputation and higher auction prices, remain particularly sensitive to both excess moisture and prolonged dry spells.

Structural Pressures Compound Weather Impact on Tea Sector

Beyond immediate weather effects, the industry continues to grapple with long-standing structural issues. Ageing tea bushes, labour shortages, high production costs and inconsistent fertiliser application have limited yield recovery even in more favourable seasons. Smallholders, who contribute a significant share of national output, have been especially affected by input constraints in recent years.

Climate change is amplifying these pressures. Research indicates that rising temperatures and shifting monsoon patterns threaten optimal growing conditions, particularly at lower elevations, while high-elevation areas face increased risks from both intense rainfall and drought. Unpredictable weather already disrupts the traditional bimodal monsoon rhythm that once provided relatively stable cropping cycles across Sri Lanka’s diverse tea regions.

Auction and Export Implications Remain Uncertain

The sharp drop in high grown volume comes at a time when global tea markets remain competitive and buyers continue to prioritise quality and consistency. Sri Lanka’s premium high grown teas traditionally command higher prices at the Colombo auctions, supporting export earnings even when overall volumes fluctuate. A sustained reduction in this category could pressure both national averages and the country’s positioning in key markets.

While Low Grown production provided a partial buffer in August, the category’s long-term productivity challenges persist. Industry reports from 2025 highlighted stagnant low grown output alongside modest gains in high and medium grown teas, reflecting uneven regional performance. Cumulative data for 2026 so far suggests the sector is still struggling to build consistent momentum.

Monitoring Weather and Input Support

Tea brokers and industry stakeholders will closely watch rainfall patterns and temperatures in the coming months. The combination of heavy rain and cloud cover that curbed August output may ease, but the risk of a dry spell early next year has already been flagged. Effective fertiliser distribution, improved field practices and adaptive measures against climate variability will be critical if Sri Lanka is to stabilise production of its most valuable High Grown teas.

For now, the August figures serve as a clear reminder of the sector’s exposure to weather extremes. With high grown output at its lowest monthly level in more than three decades, the industry faces renewed pressure to strengthen resilience while protecting the quality reputation that underpins Ceylon Tea’s global standing.