Aug 18, 2010 (LBO) - Prices of Sri Lanka's seasonal 'Uva' teas rose sharply at the latest auction with tight global supply and anticipated higher demand for the winter seen keeping the market firm, brokers said.
While the better made teas from different elevations fetched highr prices at last week's Colombo sale, poorer teas weakened in price.
Asia Siyaka Commodities said there was good general demand for teas from plantations company estates with prices were fully firm on the previous offerings.
"Select invoices of seasonal Uvas attracted special inquiry and price increases of 30 to 100 rupees (a kilo) were recorded."
The August-September period is one of the key quality seasons for the island's industry when teas from the Uva region fetch high prices.
Forbes & Walker Tea brokers said the overall quality of teas on offer showed no significant change with the exception of a selection of teas from the Uva planting districts which were brighter.
Production problems in key growing countries and the approaching winter is also expected to keep demand and prices firm.
Tea prices in northern India, which accounts for two-thirds of output, are on the rise owing to production shortfalls.
Tea brokers John Keells said global production in the third quarter is expected to be in line with previous years with the exception of North India where intakes have shown a downward trend.
"Overall June 2010 global production appears to be slightly lower to 2009 with the exception of Sri Lanka where an increase of 5.9 milliok kilos was recorded," they said.
"Slightly lower crop intakes in most major black tea producing countries and with impending cooler weather in Russia and Europe, a healthier demand could be expected in the coming months."
Demand for low grown teas, which account for over 60 percent of output, remained strong at last week's sale.
"The lower volumes on offer together with the impending Russian winter buying with a strong Middle East presence has propelled the Low Grown tea prices in the past 2 – 3 weeks."
source - www.lbo.lk
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