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Coffee Industry in Sri Lanka

Coffee cultivation was started in Sri Lanka by the Dutch in 1740 and it was not successful. The Coffee industry peaked in Sri Lanka in 1870 where over 275,000 acres were utilized for coffee plantations under British rule as Sri Lanka was a British colony. During that time our coffees were branded as Ceylon Coffee and Ceylon was one of the best coffee producers in the world. However, coffee plantations were devastated in 1969 by the fungal disease Hemileia vastatrix, also known as coffee leaf rust (CLR), affecting not only Sri Lanka but other areas in Asia over the next 20 years. The planters nicknamed the disease “Devastating Emily” and during the next few decades, the coffee cultivation land decreased to 11,392 acres and was replaced by Tea.

Ceylon Coffee Cherries
Ceylon Coffee Cherries

Challenges to Coffee Industry

Sri Lanka does not have a proper industrial-level mechanism for coffee plantation, cultivation, and processing. Hence, quality coffee beans are very difficult to collect since the farmer does not know what plants they have I.e. Arabica or Robusta as those were grown naturally without proper maintenance for a longer time.
Without proper coffee beans, the coffee industry has stagnated and not developed properly. The primary drawback was the plants are not categorized at the planting stage and when the yield produces the coffee cherries consist of both Arabica and Robusta. This becomes a major impact on the production of fine coffee which can compete with the Global Coffee Market. The challenges can be summarized as follows;

  • Land fragmentation among farmers and large land belongs to tea plantations in the hill country and it is difficult to promote coffee as a plantation crop where coffee requires highland to make the finest coffee
  • Farmers do not have sound knowledge of coffee cultivation, maintenance, harvesting, and post-harvest handling
  • There is no value chain developed for the coffee industry in Sri Lanka and stakeholders are not properly identified
  • Poor knowledge of coffee cherry processing among farmers due to small volumes and it has not been developed up to industry standards
  • Coffee roasters/do not receive high-quality dried beans for roasting due to above mentions issues such as small cultivation, no collecting methods, the small volume do not make any room for investment to make quality dried beans and finally rosters do not receive quality beans for roasting
  • Exporters are unable to make existing market requirements due to the above-mentioned issues
Worker is gathering coffee beans on plantation in bushy wood
The worker is gathering coffee beans on the plantation in bushy wood

Opportunities for Coffee Industry

The global coffee market value was worth around $ 465.9 billion in the year 2020 which was a $ 102.15 billion growth compared with the previous year which is an almost 22% year-to-year increase. In addition to that 53% of USA coffee drinkers want to buy coffee that is produced with lesser damage to the environment. Also, coffee consumers are willing to pay an additional $ 1.31 per cup if the coffee is produced by cooperative farmers as per the study conducted in 2019. In addition to the UAS market, there will be overall 40% revenue growth in the European market. The opportunities can be summarized as below;

  • $ 465.9 bn | The value of the Global Coffee Market in 2020 is up from $ 102.15 Bn in 2019
  • 53% of US coffee drinkers want to buy coffee that is good for the environment, growers, and their communities
  • $ 1.31 is what consumers are willing to pay for a cup of pour-over coffee produced by cooperative farmers, according to a 2019 study
  • >40% of the overall revenue of the growing specialty coffee market comes from Europe
Coffee Cherries
Coffee Cherries

Current Situation

Considering the status quo of the coffee industry of Sri Lanka, the federation has developed a model to develop Sri Lankan Coffee Industry. Thereby, the federation is expecting to Standardization Coffee Industry in Sri Lanka by empowering coffee farmer groups to produce high-quality 100 % natural coffee beans at the farmer organization level. The high quality of the coffee production generates a far better competitive edge for Ceylon Coffee Industry in the global market along with the competitively higher prices. The higher price generates motivation to the farmer if it goes to the farmer without any disruption in the channel. Finally, gain the glory in the coffee industry we had 150 years ago as “Ceylon Coffee”.

Roasted Coffee
Roasted Coffee

Issues & Solutions for Coffee Value Chain in Sri Lanka

1. Cultivation


  • The difficulty of affording the cost of plating materials
  • Find out quality designated Suppliers for plating materials (provide the same variety by large-scale plant nurseries)
  • Not knowing what kind of coffee variety, they have.
  • Having mixed up with different varieties.
  • Farmers are scattered and not designated neither commercially or in the home garden


  • Provide planting materials for the farmers
  • Identify large-scale plant nurseries to procure planting materials
  • Provide Arabica coffee variety
  • Organize 3 farmers’ organizations comprise scattered farmers as a solution to the land fragmentation of Central High land of the country

2. Harvesting


  • Farmers do not have sufficient equipment.
  • Farmers do not have a substantial no of plants


  • Select farmers who can plant at least 300 plants

3. Collection


  • No designated collectors in the village
  • Due to not having designated farmers, difficult for collectors to collect a sufficient amount of produces of coffee


  • Set up 3 farmer organizations and 10 processing centers to collect raw coffee cherries from farmers.
  • With registered farmers, FO is possible to estimate the volume to be processed

4. Primary Processing


  • Farmers are not designated and linked to the processors
  • Poor processing facilities & equipment
  • Fewer processors withholding small productions due to limited supply
  • Supply is limited due difficulty of grading coffee mix-up with different coffee varieties
  • Processors are not export-oriented


  • Farmers will link with FO through the process of farmer registering
  • Provide primary processing equipment to processor (coffee roster)
  • The processor will be able to estimate volume through FO.
  • The processor will have a substantial volume (Y 5= 584 Mt)
  • Link exporter is the largest value-added coffee (roasted) processor in the country

5. Secondary Processing


  • Limited supply
  • No quality assurance due to not having designated suppliers
  • Upstream sequences are not integrated and linked


  • Exporter supply constraints will be eliminated with the proposed volume of FO
  • Quality assurance can be possible by providing the same variety of coffee plants
  • The proposed value chain will integrate all stakeholders of the coffee industry

6. Sales and Marketing


  • Retailers do not have quality beans supply
  • Does not have a products range to cater to the differentiated markets and demand
  • Consumers do not have a source to purchase quality coffee
  • Inadequate of having major players in the coffee industry to promote coffee among the people.


  • FO will be developed to purchase coffee cherries from farmers.
  • The same variety will be distributed among farmers
  • Traceability reports will be kept at exporter’s factory
  • Develop Ceylon Coffee Brand for Sri Lanka such as Ceylon Tea

7. Exports


  • Import restriction of processed coffee beans
  • Exporting coffee as raw material (only dried coffee)


  • Enhance local production of coffee to cater to the local specialty market
  • Export specialty coffee for selected export markets

Note: FO: Farmer Organization

This article may help anyone who wishes to develop Coffee Industry in Sri Lanka. Also, this may help any country that wishes to develop their coffee industry for the next generation in a 100% natural way.

Information herein can be used by any interested party who wants to contribute to the Global Coffee industry in an organic manner. If you have any issues or clarification regarding this article, please do write to us. We will update whatever we know about your issues.

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