News & market updates

Asia Siyaka Commodities said March tea exports fell 16% YoY to 19.7 Mnkg, leaving 1Q exports down 4.5% to 60.3 Mnkg. Rupee earnings held at Rs.109 billion due to currency depreciation, but dollar earnings fell 5% to $351m amid higher freight/insurance and Gulf shipping disruptions.

WFP warns the Middle East conflict is threatening Sri Lanka's recovery by driving fuel costs up 33–40%, raising food and fertiliser import bills (Sri Lanka imported $2.5bn of food in 2025) and risking remittances (around 80% originate in the Gulf). These shocks could push inflation higher, weaken the rupee, strain reserves and hit tourism and household food security.

Tea production fell to 20.8 Mn kgs in March, down 14.5% YoY from 24.4 Mn kgs, hit by prolonged dry and hot weather; first-quarter output also slipped to 59.6 Mn kgs from 61.7 Mn kgs a year earlier.

The Government of Japan will provide USD 2.6 million through UNDP for two Sri Lanka projects: USD 1.5M for a climate-smart dairy programme and USD 1.16M to strengthen women deminers. The dairy project targets 750 smallholders (and ~5,000 indirect beneficiaries) in Kilinochchi and Nuwara Eliya; the deminer project focuses on Kilinochchi and Mullaitivu to improve land clearance and resettlement.

LIIN and WUSC hosted the first GRIT-EDTP investor pitch competition in Jaffna to support women entrepreneurs after training 340 participants; winner Pallueir Ltd received Rs. 600,000 in seed capital.

The Colombo Stock Exchange opened its Galle branch (its 12th) to offer CDS account openings, access to eight stockbroker firms, investor workshops and listing support, aiming to expand capital-market access for local entrepreneurs and the region's cinnamon and tea businesses.

IMF/WEO: a Middle East war-driven energy shock is raising inflation and weakening external balances in Asia; the region is projected to grow 4.4% in 2026 and 4.2% in 2027 (from 5% in 2025) under the reference forecast. Higher energy costs hit refiners, utilities, manufacturers and tourism, tightening policy space; adverse/severe scenarios could cut cumulative growth by 1–2 percentage points and lift inflation further.

IEA, IMF and World Bank issued a joint statement saying the war in the Middle East has driven up oil, gas and fertilizer prices, disproportionately hurting energy importers and threatening food security, jobs and tourism. They said they will coordinate assessments and provide policy advice and financial support.

Colombo Stock Exchange ASPI rose 0.40% to 22,218.06 at midday, with market turnover of Rs.1 billion and diversified financials leading turnover at Rs.263 million. Ceylon Tea Brokers said it will not proceed with the sale of DP Logistics and its shares were up 3.39% at Rs.12.20.

IMF warned the war on Iran raises global recession risk, cutting global growth to 3.1% in 2026 and lifting 2026 inflation to 4.4%, and presented adverse/severe scenarios with growth as low as 2% and inflation above 6% if energy disruptions persist.

Planters' Association warns fertilizer shortages caused by Middle East disruptions and closure of the Strait of Hormuz could cut Sri Lanka plantation yields over the next 2–4 months; government raised fertilizer subsidy to Rs.18,000 and a 25,000MT urea shipment is expected but will cover only a small fraction of needs.

The Asian Development Bank warned that surging global fertilizer prices—urea up over 50% and ammonia up nearly 40% since late February—could renew food inflation pressures in Sri Lanka. Higher input costs may raise production expenses, lower crop yields and add to domestic inflation amid other global risks.

The cost of a traditional kevili table rose 7% in 2026 versus 2025. Aluwa prices jumped 25.8% (driven by a 43.6% rise in cashew prices), coconut oil and rice flour together explained nearly 80% of the overall increase, and the table now costs 2.5 times its 2019 level.

The ADB forecasts growth in developing Asia and the Pacific will slow to 5.1% in 2026 and 2027 (from 5.4% in 2025), citing the Middle East conflict and trade uncertainty; regional inflation is seen rising to 3.6% in 2026. The report warns of risks from higher energy and food prices, shipping disruptions and tighter financial conditions.

Planters’ Association warns that Middle East conflict and Strait of Hormuz disruptions are restricting fertiliser supply and could hit plantation crop yields over the next 2–4 months, raising production costs and threatening export earnings. Government raised a fertiliser subsidy to Rs.18,000 and a 25,000 MT urea shipment is expected this week, but PA says this will meet only a fraction of needs.

Japan and FAO will fund a USD 1.33 million, 12-month project (Mar 2026–Feb 2027) to rehabilitate minor tank cascade systems in Trincomalee and Vavuniya, restoring hydraulic function and introducing sensor-based irrigation and climate-smart practices to boost water productivity for ~400 smallholder farmers.

IMF, World Bank and WFP warned the Middle East war threatens global energy and food security, causing sharp increases in oil, gas and fertilizer prices and rising food insecurity. They said low‑income, import‑dependent countries will be hardest hit and pledged coordinated support to protect lives and livelihoods.

Sri Lanka's recovery from Cyclone Ditwah has slowed, with more than 149,000 people still displaced and $23.4m pledged of the $35.3m required for the humanitarian plan. OCHA warns rising fuel and energy costs, supply-chain disruptions, heat-reduced hydro output and funding gaps risk food security, livelihoods, tourism and resettlement.

National tea sales average fell for a third straight month in March to Rs. 1,144.23 ($3.63), down Rs. 7.88 from February and Rs. 57.35 from the December 2025 peak. The Jan–Mar 2026 average was Rs. 1,153.25, down Rs. 26.07 from the same period in 2025.

BOI held a full-day FDI promotion session with a 15-member Malaysian delegation to showcase ready projects, land and infrastructure for immediate investment, drawing interest in ICT/data centers, solar renewable energy, manufacturing, FMCG, agri-processing and tourism.

The World Bank Group and the Government of Sri Lanka launched a five-year Country Partnership Framework mobilizing more than $1 billion in IFC investment and up to $1 billion in low-interest World Bank financing to support private-sector-led job creation and growth. The program targets easier business rules, port and energy infrastructure (70% renewables by 2030, +1 GW), tourism and agriculture support, and a first $100m REVIVE project to create about 3,000 jobs in the Northern and Eastern provi

Sri Lanka and the World Bank Group launched a five-year Country Partnership Framework mobilising over $1bn in IFC investment and up to $1bn in low-interest World Bank financing, with a first approved $100m REVIVE project for the Northern and Eastern Provinces. The plan targets easier business rules, Port of Colombo expansion, 1 GW of new clean power by 2030, tourism and agriculture job creation, and climate resilience.

Lankem Ceylon PLC has invested Rs. 3 billion to open a 50,000 tpa Single Super Phosphate (SSP) plant 'Mada Raja' via subsidiary Lankem Minerals, targeting up to 80% of Sri Lanka's SSP demand and reduced imports. The locally made SSP supplies phosphorus, sulphur and calcium to address sulphur-deficient soils and support crops including tea, paddy and coconut.

Lankem Ceylon (LCEY.N0000) invested Rs. 3 billion to commission a Single Super Phosphate (SSP) plant with 50,000 mt annual capacity, targeting up to 80% of Sri Lanka's SSP demand. The plant will use Eppawala rock phosphate and source over 30,000 mt annually from Lanka Phosphate to reduce imports and support soil health for crops including tea.

Sri Lanka and Brazil agreed to elevate bilateral trade to $1 billion by 2030. They also committed to finalising MoUs and technical cooperation projects in areas including dairy/livestock, sugarcane, agriculture, ports and shipping, and traditional/Ayurvedic medicine.

Senthilverl Holdings Ltd increased its stake in Renuka Agri Foods PLC to 10.04% after buying 1,868,913 shares on 25 March for a total of Rs. 25.1m. The purchases were made in two tranches at Rs. 13.40 and Rs. 13.50, up from a prior holding of 9.80%.