"This year will not be a year of growth. Year 2000 should bring in the recovery, while 1999 will see consolidation," said Nanda Nair, head of research at John Keells Stock Brokers.

"Plantation firms will not be able this year to replicate their good performance of 1997 and early 1998," said Dushyantha Wijesinghe, head of research at brokerage Asia Securities.

"The turnaround should come in by the first quarter of year 2000," he added.

Analysts said they expected to see net profits for the plantation sector to grow by some 10 per cent this year, down from anticipated growth of around 30 per cent in 1998.

They also said estate firms with greater exposure to rubber would see profits dwindle due to price pressures from cheaper imports from south-east Asia.

Bogawantalawa Plantations Ltd, Kegalle PlantationsLtd, Kotagala Plantations Ltd and Agalawatte Plantations Ltd are expected to perform poorly this year because of their high exposure to rubber, they added.

"We expect Maskeliya Plantations Ltd to be one of the better performers as it is mostly involved in high grown teas," said Praveen Ramanaden, analyst at CT Smith Stock Brokers.

Thirteen of Sri Lanka's 23 privatised estate firms are listed on the Colombo bourse. Some companies have a December year-end and others close their accounts in March.

Sri Lankan tea prices have been falling since August because of Ceylon tea.

Buoyant demand from crop in Kenya, another major producer country, helped Sri Lanka fetch extremely high prices in the first few months of 1998.

But the Russian economic crisis dragged the National sales average down to Rs 117 per kg at the end of 1998 from highs of around Rs 150 per kg, analysts said.

It would need to pick up to at least Rs 130 for estate firms to enjoy healthy profits, he added.

Tea brokers said buying from theCommonwealth of Independent States had risen at the first few auctions this month, but added it was little indication that prices would trend upwards. market will face a volatile period given the rouble's continued weakness," Nair said.

"Russia is not fully back in. If anything, we can expect Russian buying to pick up only by the end of the year," said Ramanaden.

Analysts said low-grown tea varieties had been the hardest hit by the Russian crisis, and profit margins on high grown teas were also being squeezed due to steeper production

"We might however see a boost in margins on lower quality teas from increased buying from India," said Ramanaden.

Last month India and Sri Lanka signed a free trade agreement for greater access to each other's market. Tea is expected to be one of the items that India would buy from Sri Lanka.