Abstract:
The herbal product sector has been identified as a key area of
promoting exports in Sri Lanka. Developed countries have changed dietary
habits into herbal products resulting from increase health awareness. The
demand for herbal products exceeds the supply in the major herbal product
markets supply in the major herbal product markets such as Europe, Japan, and
USA. Thus, developing countries have comparative advantage to export herbal
produce for the international market. Both synthetic and natural
ayurvedic/herbal medicinal products used in pharmaceutical industry in Sri
Lanka are categorized under the same coding system called Harmonized
Commodity Description and Coding System. Thus, market information related
to volume exported, price and quantity consumed are not available on trade of
herbal produce even in the customs. Information on major herbal products and
consumption in European Union, USA, Japan are collected. Tourist hotels are
the best marketing places contributing (31 %) followed by pharmacies (25 %)
and supermarkets (25 %). The best five companies, which tend to export value
added products in resent years have shown an increase in Herbal Value
Percentage compared to Herbal Quantity Percentage by 15.1 %, 79.35 %, 52.83
%, and 0.003 %. Lower product quality, high cost of production, short supply,
insufficient raw materials and their seasonal harvest, lack of market
information and lack of research and development, Lack of government
incentive schemes, recognition as an industry and training and awareness
programmes are recognized as constraints. It is suggested to develop a national
plan to promote the industry, cultivation of medicinal plants, allocation of
funds to educate suppliers, for extension services and for research and
development to upgrade the industry. This study indicated that herbal products
and herbal medicinal products consumption in Europe has been increased in
this decade. Import promotion programmes in Europe will be created higher
demand for Sri Lankan produce.
