"There were some rains in the tea growing areas and there was more rain in the month of September. So production should go up a little more in September as well," said Hasitha De Alwis, acting director general at the Sri Lanka Tea Board.

Production fell 3.1 percent over the first eight months of the year from a year ago.

Export revenue was down 5.5 percent over January to July to $794.8 million, central bank data showed, due to a dip in exports to Iran, which buys a fifth of Sri Lanka's tea. Limited appetite for tea in the Middle East also hurt shipments.

Tea is one of the $59 billion economy's main foreign currency earners, along with remittances, garment exports and tourism.

At the start of the year, the Tea Board had forecast an output of 330 million kg, but later lowered it to 325 million kg because of the drought.

While production is expected to improve from September, it is still not clear whether Sri Lanka will be able to catch up with the shortfall in output of around 7 million kg or 3.1 percent in first eight months, the Tea Board said.