Columbo, Aug 20 - High global tea prices encouraged producers to boost output by 7.9 percent in July over the same period last year, the Sri Lanka Tea Board said on Tuesday.
Tea output rose to 28.27 million kg from 26.18 million kg in July 2007.
"High tea prices in the global market have motivated the producers and they are trying to get maximum profits by producing as much as possible," said Lalith Hettiarachchi, chairman of the Sri Lanka Tea Board.
"Better weather conditions and good fertiliser applications also have helped the industry to increase the production."
Output in the January-July period rose 17.5 percent to 199.6 million kg from 169.8 million kg a year earlier, normalising production after a tea pickers' strike last year cut yields.
Output fell 2 percent to 304.6 million kg last year from 310.8 million kg in 2006, with officials citing inadequate fertiliser use due to high prices, unfavourable weather and the strike's fallout.
Sri Lanka's earnings from tea exports has risen 42.4 percent to $624.2 million in the first seven months of 2008 compared with a year earlier due to higher prices and increased demand from the Middle East.
The tea industry, which recorded over $1 billion export earnings for the first time in 2007, is expected earn up to $1.5 billion this year, Hettiarachchi said in an interview with Reuters earlier this month.
Sri Lanka exported 309.8 million kg of tea last year, including re-exports of 15.6 million kg in imports that tea companies had purchased from overseas to meet client orders.
Bulk tea accounted for nearly 60 percent of exports.
Sri Lanka's record 2005 harvest of 317.2 million kg made it the world's fourth-biggest producer behind China, India and Kenya and second only to Kenya in exports that year.
Tea is one of Sri Lanka's main foreign currency revenue earners, along with remittances, textile and garment exports and tourism.
The following table shows Sri Lanka's tea output (in kg):
JULY JAN-JULY
2008 2007 2008 2007
High Gr 6,760,477 5,620,245 49,244,979 42,470,334
Medium Gr 4,428,719 4,771,093 34,728,618 30,689,828
Low Gr 17,077,435 15,793,892 115,623,521 96,659,599
Total 28,266,631 26,185,230 199,597,118 169,819,761
($1=107.92 Sri Lankan rupees)