The History and Evolution of the Colombo Tea Auction

The Colombo Tea Auction, established in 1883, has played a vital role in the Sri Lankan tea industry. In this article, we explore the history and evolution of the auction from its modest beginnings to becoming the largest tea auction in the world. We also look at the recent shift to a digital auction system in response to the COVID-19 pandemic.

Modest Beginnings and Growth

The first Colombo Tea Auction was held on July 30, 1883, in the office of Somerville & Co. The auction was not initially successful, with only one lot of Kabaragala un-assorted tea selling for cents 45 a pound while the other four lots remained unsold due to a lack of bids. Despite the early setbacks, Somerville & Co. and other brokers continued to conduct auctions on a regular basis from 1885.

In 1894, the Ceylon Chamber of Commerce (CCC) established the Colombo Tea Traders’ Association to formulate rules for the conduct of the Tea Auction. This move was aimed at promoting the common interests of buyers and sellers in the Colombo market. Over the years, the auction grew in popularity and became the largest tea auction in the world in terms of the number of lots sold.

Changes in Auction Conduct

The auctions were initially conducted in the CCC Building in Chatham Street, Colombo, on one day of the week in a single auction room. As more tea was being sold through the auction, the number of lots increased, and the auction was split over to the second day. With further increases in the number of lots, the CCC Board Room was converted into a second auction room. Today, the auction is conducted on two days of the week concurrently in three auction rooms.

Shift to Digital Auction System

The COVID-19 pandemic brought significant changes to the Colombo Tea Auction, which had operated for 137 years through an outcry system. The pandemic led to a temporary shutdown of the auction, forcing the industry to look for alternative methods to ensure continuity of supply and demand and cash flow. The Colombo Tea Traders’ Association, supported by the Colombo Brokers’ Association and CICRA Holdings, facilitated the shift to a digital auction system.

After several discussions between various stakeholders, mock runs, and training by the electronic platform provider CICRA Solutions, the industry agreed to adopt the e-auction system. The first auction took five days as the users had to be trained, and today’s e-Auction is held for two days per week. According to CICRA Solutions, over 300 buyers have registered on the online system along with eight brokers.


The Colombo Tea Auction has undergone significant changes since its establishment in 1883. From its modest beginnings, the auction has grown to become the largest tea auction in the world, and the recent shift to a digital auction system has shown the industry’s resilience in the face of the COVID-19 pandemic. As the tea industry continues to evolve, the Colombo Tea Auction will remain a vital platform for buyers and sellers to trade Sri Lankan tea.

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