One of the major problems faced in the industry even today is the labour shortage related to fundamental tasks. While these tasks are key to the survival of the industry, the labour shortage is not limited to them. The industry, particularly the tea and rubber sectors, requires significant ground maintenance of planted areas, including weeding, fertilising, and prevention of soil erosion, among other activities. It is not uncommon to see increasingly large acreages of tea and rubber plantations neglected, while some continue to argue that more land is needed for the industry to be sustained. Optimising available land is more important than opening new land for cultivation. Researchers and industry experts argue that a key strategy to revive the industry is to make the existing, viable land more productive. This approach is essential because simply expanding the total area is often neither feasible nor desirable due to land constraints, environmental concerns such as soil erosion, and the exacerbation of labour shortages.
With increasing opportunities in education and skills development, younger individuals are migrating from plantations to other employment opportunities within Sri Lanka and abroad. This trend is contributing to labour shortages in the plantation sector and is expected to intensify as more opportunities open for this generation. One should wish such individuals well for striving for a better life for themselves and their families compared to the far from satisfactory conditions in plantations that they and their forefathers experienced. Industry leaders, politicians, media, and the general public could either ignore this issue or recognize it as a significant challenge to the industry, the country, and its reliance on earnings from plantations, and address it from a national perspective, considering its criticality to the survival of the country’s economy.
Data available on key export earnings from major plantation crops for recent periods indicate that tea export earnings were $1.43 billion in 2024, with the Sri Lanka Tea Research Institute expecting revenue to reach $1.5 billion in 2025. The rubber industry earned around $930 million in 2023, with expectations to reach between $900 million and $1 billion annually, while the government has an ambitious plan to boost this to $3 billion by 2025. Coconut-related products earned $836 million in 2022, with similar earnings expected in subsequent years. Earnings from cinnamon, pepper, and other minor crops were about $400 million in 2022 and increased to $600 million in 2023.
A key challenge faced in tea plantations is low worker productivity. Sri Lankan tea worker productivity, at around 16-18 kg of green leaf per day, is notably lower than in countries like India (40 kg) and Kenya (60 kg). Productivity also varies between smallholdings and large estates in the Sri Lankan tea industry, with research suggesting that the smallholder sector is often more productive. For instance, a 2022 estimate noted that tea smallholders produced up to 75% of total tea production while utilising about 60% of the tea-growing land area. Strategies to optimise land and increase productivity include replanting and infilling, adoption of Good Agricultural Practices (GAPs), improving soil health, proper fertilization, soil conservation, high-density cultivation, modern planting methods to increase yield per hectare, and mechanisation through technology and machinery for harvesting and other field activities to overcome labour shortages and reduce costs.
The long-term viability of the industry may also be impacted by anecdotal evidence suggesting that some larger plantation companies inflate administration costs and retain foreign exchange earnings overseas. This requires investigation to ascertain the truth. There is a general perception that some plantation companies prioritise short-term profit over long-term sustainability and are reticent about their intentions. The future of plantation companies should be evaluated with a focus on long-term sustainability. The Sri Lankan tea industry operates under strategic planning efforts, often coordinated by the Sri Lanka Tea Board and the Tea Research Institute. Multi-year strategic plans and roadmaps address key challenges, including declining production, increasing costs, low farm productivity, climate change impacts, and quality standards. The industry focuses on maintaining quality, exploring selective mechanization, and increasing market share through value addition.
The rubber industry faces dire challenges, particularly a drastic decline in skilled tappers and lack of protection from adverse weather conditions. This has led to severe under-tapping and abandonment of plots, causing rubber output in the country to plummet from 150,000 metric tons in 2012 to below 70,000 metric tons in 2023. In 2022, yield per hectare was 679 kg/ha, compared with Thailand at 1,469 kg/ha in 2018 and India at 1,459 kg/ha in 2020. By 2021, Sri Lanka had dropped to 17th position globally in total rubber production. The Ministry of Plantation and Community Infrastructure has embarked on developing strategies to address these challenges, including drafting a new roadmap for 2026–2035 and conducting stakeholder workshops to ensure comprehensive input. Key areas for consideration include assessing land currently under rubber and its productivity by district, evaluating labour availability for tapping and maintenance, exploring alternate uses for rubber land, and introducing mechanisation options for tapping.
The coconut sector has undertaken several strategic initiatives, with a formal roadmap in development. The Institute of Policy Studies (IPS) Sri Lanka is facilitating the formulation of a comprehensive strategic plan to guide institutions such as the Coconut Development Authority (CDA) and the Coconut Research Institute (CRI). Past plans emphasized research on land rehabilitation, soil improvement, and climate mitigation, while current efforts focus on improving productivity of existing plantations and meeting global demand. However, a critical challenge remains in securing labour for coconut plucking, as full-grown palms reach 15 to 18 meters in height, with some growing up to 30 meters. Technology-based methods, including drones and planting dwarf varieties, are options to address this issue. Another widespread challenge is theft of coconuts, which affects plantation owners and long-term viability, yet current plans do not address this issue adequately.
The cinnamon and spice industry earns around $500–600 million USD, and more smallholders are entering this sector in certain regions. Challenges include a shortage of skilled labour, poor infrastructure, lack of research and development, inadequate extension services, difficulties with value addition, quality control, and market access. Low productivity stems from poor plantation maintenance and delays in harvesting due to labour shortages. Quality degradation and adulteration, particularly blending Ceylon cinnamon with imported cassia, pose serious long-term risks to the industry’s brand and viability.
While it is encouraging that each sector is addressing current and future challenges, it is unclear whether labour-dependent activities critical for producing raw materials, such as weeding, ground maintenance, fertilising, plucking, and tapping, are being adequately addressed. Without this, the industry risks decline as a key revenue earner for the country. There is also a lack of awareness among the public and younger generation regarding the vital economic and social role of the industry. A national dialogue on the future of the plantation industry is timely. Such a dialogue should be spearheaded by the industry itself, with participation from all political parties, government agencies, and experts, including international specialists, focusing on land, water, labour, technology, and long-term challenges. The dialogue should be solution-oriented, include grassroots consultation, and lead to a long-term, ideally ten-year, plan for the plantation industry and its sectors.
Research and development remain critical, especially for tasks like tea plucking, rubber tapping, coconut harvesting, ground maintenance, fertilizing, replanting, and value addition. Currently, R&D expenditure for the plantation industry is a fraction of overall agricultural R&D, which itself represents less than 5% of total public agriculture spending. In 2022, agricultural R&D accounted for 27.89% of the national R&D expenditure of approximately LKR 25.28 billion (0.10% of GDP). Plantation research institutes, such as the Tea Research Institute, Rubber Research Institute, and Coconut Research Institute, have historically faced challenges, including diversion of cess revenues intended for R&D. While the plantation industry is vital to Sri Lanka’s economy, R&D funding has been historically inadequate. A way forward could be establishing a policy to allocate a percentage of foreign exchange earnings from the Tea, Rubber, Coconut, and Cinnamon and Spices industries for research and development to ensure long-term sustainability and competitiveness.
