As a Company engaged in Agriculture, we are always mindful that the long-term sustainability of our profitability depends on the sustainability of our internal & External Environment with international policies and Natural principles, which include over 7,500.00 hectares of land spread across the Central province and Uva of Sri Lanka. The long-term productivity of our land, our people and financial capital are mutually dependent. Integrating the social, environmental and economic value creation has for many years been a strategic imperative for our Company. In our Vision “To be the Environmentally sensitive Tea, rubber and other crops Producer of the World.
The Company Environmental Policy is committed to conserving the environment for future generations by aligning its plantations, in compliance with legal and voluntary international environmental standards and principles, we adopt sustainable, environmentally friendly processes with the participation of all our employees whilst creating a framework to continually improve the ethical system.
Madulsima is complied with the UN’s 18 SDGs and below 18 are the key Environmental Sustainability Initiatives of our Estates. There are many other initiatives those are directly and indirectly link to those major initiatives being implemented at ground level.
In achieving corporate sustainability, we have placed high value in identifying the various dimensions of our business and how they operate in the social, cultural and economic environment. We attempt to look internally and externally to understand our environment and its social impact. We are looking closer than ever at how and with whom we work around the world.
Economic Environment
Identifying the needs of our buyers especially in the EU and Middle Eastern destinations, is a key aspect in planning our activities in each of our markets to create a better demand for our produce. They expect the products they buy from us are produced responsibly.
Learning sustainable growing practices is a key aspect in being adoptive and in being resilient to climate change. Educating our senior managers to share knowledge, raise awareness and support the implementation of sustainable agriculture principles and practices is an important aspect of our corporate sustainability strategy. Regular discussions and workshops have been undertaken in this regard to spread the message among our workforce with a view to improve their productivity. The training programs focus on topics such as practices for improved harvesting and thereby yields, crop diversification and achieving community support for adaptation of other crop varieties which traditionally they have been resisting.
Tea Smallholders play a critical role in our supply chain. Going forward we intend building closer relationships with them that would improve their agronomic practices and entrepreneurial skills to be partners in our progress. We recognize that farmer organizations can play a key role in supporting smallholder relations and create a stable and long-term business commitments.
The production process of tea is such that the industry’s maximum power need coincides with the power system peak demand, thus consuming expensive energy. This industry is largely located in the Central and Uva provinces, where the topography coupled with heavy persistent rainfall offers a good opportunity to harness hydro-power, the most widely used power source in the plantation sector, to meet the entire power requirement of the industry. This potential remains largely underutilized, as grid electricity supply is at present available in almost all tea estates, particularly at the factories where tea is processed. These plantations also practice cultivation and harvesting of fast-growing tree species in abandoned tea-growing land to meet the industry’s thermal energy requirements. This biomass usage could also be extended to electricity generation, though realizing the scope for this application in the Sri Lankan context is in an experimental stage.
In April 2020, the Colombo auction prices rose sharply as global tea supply continued to tumble due to labor deployment issues as a result of COVID 19 pandemic and adverse weather. Weaker local currency, demand induced by the perceived health benefits of black tea and higher tea consumption amidst lock downs have also helped the Ceylon tea prices to stay buoyant for the said period. Current, higher prices have to a larger extent compensated for the impact on financial performance of tea producers from the lower production levels.
Sustainability Report
However, with the oil prices plummeting to historical lows, ICRA stated that it will continue to monitor the sustainability of the current price levels as there is a relatively strong correlation between oil prices and Sri Lankan tea prices.
Forestry Management & Sustainability
Overview: “Our Sustainable Environmental Management Strategies Follows an Integrated Levels Approach Models” Being an ownership/custodian of 7369 hectares of nation’s economically high value and environmentally sensitive land resource, we are deeply committed towards protecting the environmental in which we operate for the benefit of the present and future generations.
Our approach to environment management is well in line with the national policies and legislative requirements relating to the with the national policies and legislative requirements relating to the environment and biodiversity. We have obtained certification from the globally acknowledged Rainforest Alliance (RA), Sustainable Agriculture Network (SAN) and ISO 22000, whilst being a member of the Biodiversity Sri Lanka – the only national initiative in which the corporate sector works together with conservation agencies on environmental and biodiversity related issues.
Our well – integrated environmental strategy is formulated based on the comprehensive risk assessment set out below, covering all environmental aspects.
| Environmental Risk Assessment Risks Interconnected with Natural, Operational and Human Activities | |
| Climate Change Extreme Weather Conditions Change in rainfall pattern and ambient temperature | HIGH |
| Risk Assessment Land Degradation Adverse impact on yields and quality of Tea. Difficulty in forecasting crop and quality of tea. Drop in crop intakes and profitability. Forest Fires Reduce employment opportunities. Adverse impact on Biodiversity. | Risk Management Strategies Planting tea, green manure/shade, native, cash crops and fruit plant species to increase tree canopy cover and carbon sequestrations. Implementing sustainable agriculture practices. Planting drought resistant cultivars. Rainwater harvesting in ponds to sustain the ground water table, improve microclimate conditions and regulate ambient temperatures. Partner of establishment of Peak Ridge Forest Corridor to conserve the mountainous Leopards in Bogawanthalawa region. |
| Water Water scarcity due to climate change and high consumption by the expanding estate community. | MODERATE |
| Soil Fertility Depletion of soil organic matter and nutrients. | MODERATE |
| Risk Assessment Extreme rainy weather may cause loss of top soil, soil fertility and soil nutrients. Steep terrain in the tea fields may accelerate the soil erosion intensity. Harvesting of timber in timber plantations will be a loss of canopy coverage of the land and accelerate the soil erosion intensity and increase the adverse effect of climate change due to change the micro climatic conditions of the area. | Risk Management Strategies Planting green manure and shade trees under five-year shade management plan of MPL. Comprehensive forestry planting programs parallel to the five-year forestry management plan of MPL. Inter planting Coffee as a shade tree and soil improvement technique. Composting of weeds. Establishing stone and live terraces. Maintaining the standard mana grass density of tea new clearings. Soil testing and rational application of dolomite and chemical fertilizer. |
| Green House Gas (GHG) Emissions Green House Gas emissions from agricultural operational activities and domestic consumption. | MODERATE |
| Risk Assessment Green House Gas emissions fuel used in transport and supervisory vehicles. Green House Gas emissions from electricity usage in factories, staff quarters, officers and other buildings. | Risk Management Strategies Measuring and monitoring GHG emissions at each operational site. Measuring and monitoring electricity and fuel consumption at each operational site. Planting trees and increasing tree canopy cover for increase carbon sequestration. |
Carbon Foot Print
Madulsima Plantations PLC is the first tea growing, manufacturing and selling under the Uva tea growing region category, offering uncompensated carbon certified teas from its state of art facilities. The company is being placing great emphasis on the environmental aspect considering the effects of global warming.
Our protocol of Green House Gas (GHG) Inventorying is IPPC 2018, Volume 7 and ISO 14064-1. scope was the cradle of plantation to warehouse gate. All emission sources were considered to cover scope 1,2 and 3 emission categories.
- Scope 1 (direct emissions) - Fossil fuel consumption in building and vehicles, agriculture land management activities
- Scope 2 - Electricity and heat consumption in buildings
- Scope 3 - Other indirect emissions (third party transport)
Result of this exercise indicate total emission for fiscal year 2020 is 2015 tCO2e (metric tons of CO2 equivalent) taking all sources and sinks in to consideration. Total classic emission for the complete process is 0.014 tCO2e/Kg of Black Tea. Our next milestone to sink 100 g of CO2 equivalent, per production of 1 kg of made tea by 2025 through our Forestry planting programs and other land use management practices establishing solar power projects for factory roof tops and improving and increasing capacity of existing Hydro Power projects.
Water Footprint
Water Footprint of MPL tea estates is an indicator of both direct and indirect water use of the producer. Calculation process of water footprint of MPL estates done in to three main categories as per the CROPWAT 8.0 model developed by the Food and Agriculture Organization of the United Nation (FAO, 2003) and Water Foot Print Assessment manual 2011. Value of the water foot print of MPL estates around 1050.56 m3/ton/yr as per the assessment.
Water audits, awareness programmers and water conservation practices are being implemented to manage the water resources available in MPL tea estates.
Sustainable Soil Development
The company invest more than 5 Mn. per annum for sustainable soil development practices in our tea new clearings and other crops planting areas. Since the soil development has been declared under the MPL agricultural policy and organized as a thumb rule of productivity improvement in tea plantations.
Forestry and GIS and Research and Development Unit of MPL
Forestry and GIS unit of MPL established in year 2018 to streamline the forestry management and sustainability activities including timber harvesting, forestry replanting, land use mapping using GIS and remote sensing technology and implementing crop diversification projects.
Throughout past three years, this unit achieved remarkable improvements by addressing long and short-term sustainability goals to MPL. unit introduce some new technical initiatives such as GIS Mapping of forestry plantations, timber Inventory preparations, Tree tagging in census taking, preparation of technical reports pertaining to timber harvesting projects and establishment of timber nurseries with high quality seeds materials
Research and Developments
This unit mainly focus on to the knowledge gaps of estate sector under Forestry, Diversification, Agronomical and sustainability fields with the collaboration of Uva Wellassa University, Badulla Sri Lanka. Since 2018 R & D unit of MPL conducted and being conducting several research projects.
Forestry Plantations Management of MPL
Establishment of forestry plantations are another key activity of our sustainability green venture and we are conducting our forestry replanting projects in two main objectives known as production and protection.
Establishment of Production (Commercial) Forest Plantations is a continuous program parallel to the company annual Timber Harvesting Program. Currently company maintaining 376 Ha of Protected and 1470 Ha of Production Forest areas (Timber + Fuel- wood) on a sustainable basis. Majority of the low yielding tea lands, duly timber harvested blocks and other vacant areas plant with high quality Eucalyptus species under company forestry replanting project which is parallel to the Five-year Forestry Master Plan of MPL 2020 – 2025.