PROJECT CODE: 16 AG-04 –GE-TRC-B

TITLE: Training of Trainers in the GLOBAL GAP standards for

greater market access

VENUE: Lahore: Pakistan

COUNTRY CASE STUDY

SRI LANKA

Prepared by:

G.NIRMALA DE ZOYSA

ASSISTANT DIRECTOR (TECHNICAL)

SRI LANKA STANDARD INSTITUTION

No17, VICTORIA PLACE, ELVITIGALA MAWATHA

COLOMBO 10.

SRI LANKA.

1.0 INTRODUCTION

1.1 General overview of Sri Lanka

Sri Lanka is an island in the Indian ocean located between 79° 50' and 82° longitude and 6°

and 9° 50' latitude. The total land area of the island is 6.5 million hectares and the population

is 21 million.

.

1.2 Climate

Sri Lanka is located in the tropical belt of the world climatic map. The central hills of the country

divide Sri Lanka into three major climatic zones , namely the wet, intermediate and dry zones which receive an average annual rainfall of >5000-2500 mm, 2500-1750 and 1750-900 mm,

respectively. Rained wetland rice cultivation is mainly practiced in the wet zone.

The mean temperature ranges from 70-89°F. The annual precipitation follows a distinctly bi-

modal pattern and the country receives rainfall from two monsoons: the northeast monsoon

(November to January), referred to locally as the mama season, and the southwest monsoon

(May to September), known locally as the Yale season. .

1.3 Socio Economic context

Sri Lanka is a lower middle-income country with a total population of 21.0 million people

and a per capita income of USD 3,924 in 2015. Following a 30 year civil war that ended in

2009, Sri Lanka’s economy has grown at an average 6.4 percent between 2010-2015,

reflecting a peace dividend and a determined policy thrust towards reconstruction and

growth.In 2015, the service sector accounted for 62.4 percent of Gross Domestic Product

(GDP), followed by manufacturing (28.9 percent), and agriculture (8.7 percent).Since the end

of the three-decade civil conflict, Sri Lanka is now focusing on long-term strategic and

structural development challenges as it strives to transition to an upper middle income

country.

1.4 Gross Domestic Product (GDP)

The Gross Domestic Product (GDP) in Sri Lanka was worth 82.32 billion US dollars in 2015.

The GDP value of Sri Lanka represents 0.13 percent of the world economy.

National flag Government logo

Graph: 1: Growth rate of Gross Domestic Production

Source: Export development board

In the first quarter of 2016, gross domestic product reached up to 2,088,024 million rupees

against 1,978,609 million rupees recorded first quarter of 2015.Growth rate of the

agricultural activities however have shown only a slight increase of 1.9 percent. Among the

sub activities, growing of vegetables showed a high growth rate of 16.3 percent while

growing of oleaginous fruits reported 10.0 percent growth.

Contribution from tea decreased by 11.6 percent during the quarter while rubber and marine

fishing suffered slight falls in the growth rates by 2.6 percent in each activity.

2.0 AGRICULTURE SECTOR IN SRI LANKA

The agriculture sector is the cornerstone in Sri Lanka's economy with more than 70% of the

population living in rural areas depending on agriculture for their livelihoods. Currently this

sector contributes to about 18% of the Gross Domestic Product (GDP) and 30% of the

employment. Rapid agricultural productivity growth is fundamental for reducing poverty in

Sri Lanka as nearly 90 per cent of the poor live in the rural agricultural economy.

Agriculture, which consists of domestic and export sub-sectors, remains a vital sector in the

economy through the provision of income, employment, foreign exchange, food and raw

materials. It also stimulates growth in the rest of the economy through its forward and

backward linkages with other economic sectors.

The growth in Agriculture sector was largely attributable to the significant expansion of the

growing of rice. Maize, Tea, coconut, Rubber, fruits and vegetables. Further contribution

given by spices, and perennial crops, and other cereals crops. Growing of sugarcane, coffee,

and other cash crops like chilies, onions potatoes dampened the growth in Agriculture in

2014 - 2016.

Crop 2008 2009 2010 2011 2012 2013 2014

Paddy 1,052,995

977,145 1,065,281 1,091,049 1,066,617 1,227,248 964,268

Rubber 116,478 124,000 124,734 127,000 130,280 132,904 132,904

Coconut 394,836 394,836 394,836 394,836 394,836 394,836 394,836

Cinnamon 26,770 28,090 28,860 29,163 30,432 30,090 29,512

Coffee 8,790 8,720 8,540 8,686 8,458 8,740 8,340

Cocoa 2,690 2,740 2,730 2,548 2,534 2,257 2,170

Pepper 34,070 36,180 37,340 36,431 37,825 39,493 39,650

Cardamom 1,320 1,450 1,530 1,547 1,510 1,692 1,680

Kurakkan 6,080 5,900 6,570 5,345 5,195 5,953 7,420

Maize 51,600 50,860 57,620 51,182 59,529 67,722 67,214

Source: Department of senses and statistics Sri Lanka

2.1 Paddy

Rice is the staple food of the inhabitants of Sri Lanka. The total land devoted for paddy is estimated

to be about 708,000 Hectares at present. There are two cultivation seasons namely; Maha and Yala

which are synonymous with two monsoons. Maha Season falls during “North-east monsoon” from

September to March in the following year. Yala season is effective during the period from May to end

of August. However, the whole area devoted for paddy is not being cultivated due to number of

reasons such as shortage of water during the seasons, prevailing unsettle conditions on the ground,

etc. Cultivation is facilitated through rain fed and irrigation water. The cost of rice production has

increased tremendously during the past few decades and consequently rice production has become

uneconomical in marginal rice lands, especially in the wet part of the island.

Graph 2: Trend of paddy cultivation area (year vs extent Ha)

Source: Department of Census and statistics –Paddy statistics

0

200000

400000

600000

800000

1000000

1200000

1400000

2008 2009 2010 2011 2012 2013 2014

Table1: cultivated extend by 2008-2014 (Ha)

2.2 Plantation crops

2.2.1Tea

Tea production is one of the main sources of foreign exchange for Sri Lanka and accounts for 2% of

GDP, contributing over US $1.5 billion in 2013 to the economy of Sri Lanka Sri Lanka is currently

ranked as the fourth largest Tea producer in the world and the world's largest tea exporter in

year 2013. Annual export volume was around 320,000 MT and export earnings were recorded as US$

1.5 Bn in year 2013.

Ceylon Tea Lion Logo which appears on Ceylon tea packs denotes not only the country of

origin but also the quality of Ceylon Tea. Sri Lanka Tea Board is the legitimate owner of the

Ceylon Tea Lion logo which has been registered in many countries in the world.

Sri Lankan Tea industry maintains the highest quality in the world

market and ISO 3720 is the minimum standard applies for the products. Growers are

constantly educated to practice Good Agricultural Practices (GAP). The Processing/

Manufacturing facilities owned by the export companies comply with local standards (SLSI)

and also with International Quality Standards such as ISO, HACCP, and EU Standards. Sri

Lanka has the capability to produce the cleanest tea in the world in terms of minimum

pesticide residues.Ceylon tea became the front-runner of the industry and was much loved for its unmatched quality and variety and reputed for its signature taste and aroma.

Graph3: Tea export price and volume

Source: Central Bank Report 2015

0

100

200

300

400

500

600

0

50

100

150

200

250

300

350

19

99

2

00

0

20

01

2

00

2

20

03

2

00

4

20

05

2

00

6

20

07

2

00

8

20

09

2

01

0

20

11

2

01

2

Volume Mn Kg Price Rs/Kg

Mil

lio

n K

g

Rs/

Kg

Tea Ex.

Main destination of Sri Lankan teas : The most important foreign markets for Sri Lankan

tea are the former Soviet bloc countries -the, United Arab Emirates, Russia, Syria, Turkey, Iran,

Saudi Arabia, Iraq, the UK, Egypt, Libya and Japan.

2.2.3 Coconut

Coconut is one of the major plantation crops in Sri Lanka which accounts for approximately

12% of all agricultural produce in Sri Lanka. Total land area under cultivation is 395,000

hectares and about 2,500 million nuts are produced per year. Moreover, the coconut and

coconut product manufacturers and suppliers of Sri Lanka are guided by a stringent set of

regulations to ensure the quality of their products. Coconut Development Authority, Coconut

Cultivation Board and Coconut Research Institute are the three major Government

Institutions that are responsible for the production & quality improvement, supply

development and research respectively. Sri Lanka is very popular in world market for

Desiccated Coconut (DC) and Brown fiber. Distinguish white colour and characteristic taste

of Sri Lankan DC has ranked Sri Lanka at 4th position of world export market for all kernel

products. Sri Lanka holds the global No.1 for the exports of Brown fiber.

Table 2: Extent, production and yield of coconut

Item Unit 2010 2011 2012 2013

Production Mn. kgs 331.4 327.5 328.4 340

Total Extent

'000 hec.

212.7

206.1

203

204.1

Yield Kg/ha 1,478.00 1,475.60 1,688.40 1756.2

Source: Coconut Cultivation Board

This sector employs around 140,000 people in all parts of Sri Lanka.The Sri Lankan coconut

industry has developed capabilities for exports in the following coconut product groups:

Desiccated coconut, coconut cream and milk, coconut milk powder, virgin coconut oil,

coconut fiber products such as brushes and brooms, coir twine, geo-textiles, coco-peat

products, activated carbon made from coconut shells and etc. There has been an upsurge in

demand for Desiccated coconut in EU markets which also matches with capability of Sri

Lankan exporters.

Graph 4 : Coconut export performance

Source: Export Development Board

2.2.4 Rubber

Sri Lanka prides itself in manufacturing a number of value added rubber products by

processing raw rubber. These ranges from rubber products made in Sri Lanka are

internationally acclaimed and accepted for quality and durability. At present the country

ranks among the world's top ten largest producers and 7th

largest exporter in natural rubber.

Sri Lanka Rubber Industry consists of two closely independent sectors; the rubber plantation

industry which producers raw rubber and high value new product innovations in finished

rubber goods. Presently, Sri Lanka produces about 153,000 metric tons of natural rubber

annually. The production & processing of natural rubber and the product manufacturing

industry together provide gainful employment to over 300,000 persons making this industry a

mainstay in economic sustenance while at the same time providing a high degree of

environment friendliness through the natural forest cover provided by the rubber plantations

and substantial carbon sequestering.

The globally linked rubber industry in Sri Lanka shows excellent potential for exponential

growth with the global industry growing annually at 4-6%. Sri Lanka’s range of products has

ample room to evolve with new developments and research in the field. With opportunities in

the global markets being assured to technically sound and innovative local rubber & rubber

based product manufacturers & suppliers.

Table 4: production of natural rubber

Unit 2008 2009 2010 2011 2012 2013 2014 2015

Total production M.T. 000 129 125 152.95 158.20 152.03 130.41 98.57 88.57

Total exports M.T. 000 49 56 51.50 42.61 37.38 23.58 16.50 10.37

Export value Rs. Man 13,535 11,327 19,256 22,811 15,726 9,194 5,916 3548

Local consumption M.T. 000 80 85 119.61 128.25 125.69 118.41 116.05 127.42

Table 3: Statics on Rubber cultivation

2008 2009 2010 2011 2012 2013 2014 2015

Total extent under rubber (ha) 119,543 122,087 125,645 128,119 130,415 132,534 133,762 134,409

a. Extent under tapping (Ha) 94,317 93,549 97,961 96,987 99,275 101051 105981 114,102

Total replanted area (ha) 6,105 6,362 5,941 3,050 2,161 2,717 2,096 1,031

Total new planted area(ha) 2,544 789 2,953 3,004 2,476 2,979 1,428 769

Subsidies for replanting & new planting(Rs Man) 130 347.36 370.63 571.06 287.43 436.49 567.27 594.5

Ave. yield per Ha.(Kg) 1,246 1,382 1,561 1,631 1,531 1,290 930 776

The United States, Germany, Belgium, Italy, UK are the main Rubber Export Markets for Sri

Lankan rubber. There are few Major Markets for Semi-processed Sri Lankan rubber also

.Those are Pakistan, Malaysia, India, Japan, Germany.

Graph:5-Export performance -Rubber

Source: Sri Lanka Export Development Board (SLEDB)

2.2.5 Spices

Known as the spice island Sri Lankan spices and allied products suppliers export the cinnamon,

pepper, cloves, cardamoms, nutmeg, mace and vanilla. Cinnamon exports in primary form as well as

in the value added form such as cut pieces, powder form and crushed form. Cinnamon is considered

as unique product exporting from Sri Lanka. Sri Lanka is the world largest producer & exporter of

Cinnamon to the world. Cinnamon has originated in Sri Lanka & it has unique characteristics, which

can be branded under GI protection. Accordingly Ceylon Cinnamon introduced to the international

market as a branded product namely "Pure Ceylon Cinnamon" which reflects a combination of

several intrinsic characteristics of Cinamomum Zylanicum.

Pepper is the second important commodity among spices and Sri Lankan pepper has high

intrinsic quality. The Sri Lankan Pepper has higher piperine content which gives it a superior

quality and pungency.

Other spices such as cloves, cardamom, nutmeg and mace also export.Sri Lankan clove is

found to be richer in oil than those from other growing countries in the world. Cardamom

exports from Sri Lanka constitute light green verities.

Table: 5 Extent of Export Agriculture Crops 2002 – 2009 (Ha)

Crop 2002 2003 2004 2005 2006 2007 2008 2009

Cinnamon 26,953 27,074 27,207 27,424 27,759 28,405 28,971 29,415

Pepper 27,662 28,252 28,719 29,108 29,462 29,910 30,156 30,506

Clove 7,608 7,608 7,608 7,608 7,608 7,608 7,608 7,611

Cardamom 2,780 2,781 2,784 2,784 2,784 2,784 2,785 2,794

Cocoa 2,463 2,467 2,470 2,470 2,470 2,502 2,513 2,521

Nutmeg 910 910 910 910 910 911 914 926

Source: Department of export Agriculture

Table: 6 Productions of Export Agriculture Crops 2003 - 2009

Crop Estimated Production (MT.)

2003 2004 2005 2006 2007 2008 2009 2015 2016

Cinnamon 14,153 14,879 15,898 15,792 16,795 14,691 15,690 19500 25000

Pepper 13,778 11,016 14,303 14,801 16,377 12,897 12,306 34000 43000

Clove(with

stem) 2,907 3,988 6,077 3,505 2,886 8,553 3,032

5000 6500

Cardamom 64 65 74 79 80 70 61 650 820

Nutmeg &

Mace 1,865 1,605 2,054 2,092 2,267 2,265 2,379

6300 8000

Cocoa 1,084 527 902 1,055 1,336 1,696 2,453 3250 5500

Source: Department of Export Agriculture

Major export market for cinnamon Mexico, Peru, USA, Colombia, Egypt, Germany, Spain,

Singapore, India, Germany, Kuwait, Spain, USA, Egypt and UK for the main market for

Pepper. Cloves export to India, Kuwait, Malaysia, USA, UK and Saudi Arabia and other

spices are export to India, USA, Spain and UAE.

2.2.6 Fresh fruits and vegetables

Fruits and vegetables are mainly grown by semi commercialized small farmers whose

individual extent of land does not exceed a hectare in SL. Private sector involvement in

commercial cultivation too has been encouraged by the Sri Lankan Government with support

from 'contract growing' farmers, and steps have already been taken by the leading entities to

enhance cultivation.

Sri Lanka produces more than 900,000 metric tons of fruit and vegetables annually and

exports both fresh and processed varieties to many destinations in the world.65 of the fresh

product is targeted to the Middle East and the Maldives Island and almost about 98% of the

processed products to the European market. United Arab Emirates, Saudi Arabia, Maldives,

India, UK, Kuwait, India, Germany, Qatar, Pakistan have been enlisted as top fruit and

vegetable importing countries from Sri Lanka.

3.0 MAJOR ISSUES AND CHALLENGES

There are major agricultural development issues and challenges that affect income,

employments, food security, agrarian poverty and export earnings. The can be identified as;

stagnating productivity, lack of agricultural diversion, agrarian poverty, food insecurity,

inefficiency in water management, climate change, natural disaster in agriculture and re-

governing markets

Social and technical constraints: The absence of knowledge about competitive export

market and production of quality produce. Lack of knowledge about novel agricultural

technology, crop protection methods, maintaining of quality, unavailability of facilities in the

farm for storage are the social and technical restrictions.

Pest and disease: Crops are highly susceptible for pest and disease in nature due to climatic

condition of Sri Lanka. Fruit flies attack most of the fruits and quality of fruits lower and it is

a major problem in exporting.

Imported planting material are commercially using for export oriented productions but need

to pay incentive attention for protect those crops from pest and disease. In such situation

farmers used to utilize agrochemical. Due to lack of knowledge sometimes they are using

excess mount of agrochemicals. Agriculture extension service under the Department of

Agriculture provide their services to island wide, but farmers violate their technical advises.

Result of the chemical application is exceeding the MRL in agriculture produce especially

fresh fruits and vegetables. This is a major reason for rejection of consignment when export.

Standards and quality assurance: Even though many standards are available for agriculture

sector farmers are not follow those standards. No any quality assurance system established up

to last year. Quality inspection system or quality assurance system not functioning in farm

level or farm gate level.

Plant quarantine services randomly check the consignment before export only for the sanitary

and phytosanitory requirement but not for the MRL.

Laboratory facilities. In Sri lanka there are limited number of laboratories available for

testing of fresh produce. Modernized and sophisticated instruments and facilities are limited

and under this circumstance testing are limited for export products.

Economic Constraints: Diversified cropping demands high input conditions and this leads to

increase in the cost of production. In addition, most of this produce is perishable in nature

and cannot be stored at farmer-level for a long period.

4.0 MAJOR ACTIONS FOR INCREASE PRODUCTIVITY AND QUALITY

Certified seeds paddy issue by Department of Agriculture . Export development Board has

identified export requirement of few rice verities and together with agriculture department

running few projects for quality development of rice verities for export market. Fertilizer

subsidy provided for paddy farmers and water supply free of charge by the government.

Mean while crop insurance scheme has been introduced for major crop to minimize risk of

natural disasters. GAP for rice farming to be established by DOA. Paddy marketing board

government owned institution established for the marketing activities of purchasing of paddy

at certified price. Field officers are collecting samples and testing samples for few quality

parameters before purchasing paddy. Institution has storage facilities in island wide.

With the introduction of the GAP standards for fruits and vegetables sector, Department of

Agriculture and Ministry of Agriculture stated farm registration programme island wide.

Commercial farmers who willing to follow the GAP standard will providing technical

assistance free of charge and they will improve step by step. Auditors appointed for the

running of scheme and GAP certified produce will export in future. European Union

delegation visited to Sri Lanka to carrying the audit in Sri Lankan agriculture sector and

corrective actions are taken to develop the system for better production in Agriculture.

Meanwhile, a number of Sri Lankan fruits and vegetables cultivators have initiated the

production of organic fruits and vegetables.Sri Lankan farming communities are constantly

educated about the maintenance of Good Agriculture Practices(GAP) at nurseries and farms,

and many Sri Lankan mass producers and exporters of fruit and vegetable have received the

Global GAP certification. Government has paid more attention to develop pack house at

standard level. Awareness programmed for GMP (Good manufacturing practices) also

conducting for fruit and vegetables manufacturing establishment with Department of

Agriculture and Standards institution. In addition to that CAB- Counselor for Agribusiness

appointed for the council ling of farmers for their problem and CAB officer’s duty is regular

farm visit for better production at the farm level.

Coconut Development Authority has mandated some standard for the coconut based produce

focusing export market.

Tea board has introduced lion logo for pure Ceylon tea to protect identity in Sri Lankan tea at

the export market. Different certification such as SLTB- SLSI certification, UTZ

certification, Rain forest certification are promoting by the Sri Lanka tea board and tea

research institution for quality maintaining of the tea industry. Good Agricultural Practices

are promoting among tea plantation and GMP promoting among tea processing factories.

Quality management system has been introduced for many manufacturing organization by

Sri Lanka standards Institution. In addition to that SLS- Sri Lanka standard certification issue

for the products complying with Sri Lanka Standard. Sri Lanka has entered to the regional

standards harmonization projects for some agricultural products to lose the trade barriers at

the export.

Sri Lanka has taken several steps to enhance and improve the spice industry. Processing

centers have been upgraded to achieve international quality standards such as HACCP. More

emphasis is given to improve agronomic practices by educating farmers on good agricultural

practices. Small producers are encouraged to follow good manufacturing practices when

drying and processing these products.

5.0 SRI LANKAN GAP ADOPTIONS AND GLOBAL GAP CERTIFICATION

Sri Lanka Standard Institution has formulated a Sri Lanka Standard specification for Good

Agricultural Practices (SLS 1523: 2016) for fruits and vegetables sector.This standard

addresses Good Agricultural Practices (GAPs) that .helps to control microbial, chemical and

physical hazards associated with all stages of the production of fresh fruits and vegetables

from primary production to packaging at farm gate.

Global GAP –control points and compliance criteria fruits and vegetables was referred at the

formulation of Sri Lankan Gap standard. Global GAP certification has obtained less than 5

companies in Sri Lanka due to high certification fee an audit charges.

GAP scheme monitored by the Department of Agriculture and Ministry of Agriculture with

assistance of Sri Lanka Standards Institution. Department of Agriculture has been started

farm registration programmed for GAP certification scheme. Committed farmers need to be

registered under the scheme and through extension service farmers will upgrade for their

farm activities. Established certification body will issue GAP certification free of charge at

the initial stage. Around 100-200 fruits and vegetables farms are started Good Agricultural

practice for better production up to date. Mean while Agricultural extension Offices Island

wide provide technical services. Ministry of Agriculture encourages farmers to obtaining of

GAP certification through different awareness programme. Export oriented large scale

farmers has been identified and agriculture loans facilities are provide for them. Fruits and

vegetables producers, processors and exporters association also conducting farmer aware

programme on GAP with different government organizations.

.

. .