Iraq Becomes Sri Lanka’s Largest Tea Buyer as Export Revenue Falls

Sri Lanka’s tea industry has been hit by rising energy and shipping costs linked to tensions in the Middle East, even as Iraq emerged as the country’s largest tea buyer. Tea export earnings fell 17.3% in March 2026 from the same month a year earlier to $114.75 million, underscoring pressure on one of the island nation’s most important economic sectors. Tea shipments to Iraq also declined by 38% in March, while volumes sent to the United Arab Emirates dropped 93%. Sri Lankan tea companies have begun shifting toward alternative markets including Canada, the United States and South America as fuel and logistics expenses continue to rise. The tea sector remains one of Sri Lanka’s key economic pillars and provides employment for about 2.4 million people. The sharp fall in export revenue highlights the wider impact of regional instability on trade flows and operating costs.