The price of tea is likely to climb further this year as dry weather has slashed production in India and Kenya.
Flooding and landslides in Sri Lanka may disrupt exports.
In India, the world’s leading producer of black tea, production is down by 16 percent from last year. This year’s total output is likely to be 15 to 20 million kilograms lower than last year’s, despite rising consumption. Output in Kenya has dropped by over a third from last year. As a result, the maximum price of the highest grade of Kenyan tea on auction last week rose by 33.5 percent.
Fortunately, improved weather is expected to raise production levels in the second half of the year.