Some weeks ago, liquoring BOPFs commanded a huge premium over the BOP grade, sometimes by as much as Rs 100. In addition, the D1 grade of such marks was also selling at a premium.
Consequently the BOPF/D1 grade percentages have increased and a resultant drop has been witnessed against the BOP.
This has led to a tight supply situation of the BOPs, which consequently have benefited by a steady rise in price.
Whilst the market for liquoring teas has continued to be at attractive levels, the gap between the two grades reduced progressively and this week, many of the BOPs went above the BOPF grade.
The BOPs have received demand from Japan and UK along with some Russian interest particularly for the grainier invoices.
For the BOPFs, it has predominantly been Russian interest that has kept the prices buoyant, with the tea bag sector extremely active.
The selective buying this week, pointed towards the completion of some of the urgent orders. Given that the prices in Kenya have been well below the levels of Colombo, interest from UK for this grade has seen a greater focus at the Mombasa auctions. Interest from Pakistan in Kenyan Teas declined temporarily pending the signing of the trade agreement, but increased activity was witnessed this week.
The market for Low Grown teas has been fairly attractive with the weekly average fairly stable close to the Rs 400 level, having peaked at Rs 419.74 at the beginning of September.
As we are now in the third week of October, one could traditionally expect the demand from Russia and CIS to vain in the final two months of the calendar year in the expectation that peak winter buying would be completed.
The world crop surplus in the current year which is around 115 mkgs more than last year also appeared to point in this direction, whilst the significant price gap between Colombo and other auction centres would have downward pressure on our auctions.
However it’s good to learn from certain segments of the industry that they continue to receive reasonable orders, thus pointing towards a moderate market correction as against a sharp fall in prices.
A couple of weeks ago news items from Iran indicated that due to US sanctions, the currency has fallen by around 20 percent which would hurt imports, whilst a report of a ban on tea imports has also affected the purchasing of tea, should Iran be in a position to overcome this issues, we could see more interest for Low Grown small leaf grades and tippy teas which would greatly compensate for a drop in demand from the CIS.
Colombo auctions offer quantities will also play a key role in market stability and the current low crops reported from most planting district will contribute towards same. The tail end of the South West monsoon was unusually strong and many reservoirs reached spill level, whilst the Victoria, the largest reservoir was almost at spill level.
However the inter monsoon afternoon thunder storms which is customary in October have not been witnessed, but rain showers continue in many planting district.
Western Teas
Select Best BOPs declined Rs 10, other good invoices appreciated by a similar margin and more, Below Best sorts advanced Rs 10 to Rs 15 on average, plainer varieties gained Rs 20 to Rs 30 and more at times.
A few Select Best BOPFs were firm, whilst most others declined Rs 20 on average, Below Best sorts were firm and declined as the sale progressed, plainer varieties shed Rs 10 to Rs 15 and more at times. Better Medium BOPs declined Rs 10, others advanced by a similar margin and more. BOPFs shed Rs 15 to Rs 20.
Nuwara Eliya Teas
Bright Nuwara Eliya BOPs advanced Rs 10, others were barely steady. BOPFs declined substantially with a large volume remaining unsold.
Uva Teas
Coloury BOPs gained Rs 20 to Rs 30, others were Rs 10 to Rs 15 dearer. BOPFs shed Rs 15 to Rs 20 on average. Udapussellawa BOPs advanced substantially, whilst BOPFs declined Rs 10 to Rs 15.
CTC Teas
Select Best Low Grown PF1s were firm, others declined Rs 15 to Rs 20. BP1s were firm. High and Medium PF1s declined Rs 5 to Rs 10. BP1s were firm to easier.
Low Growns
Good demand. Select Best OP1s appreciated Rs 20 to Rs 30, Best types were irregularly dearer by Rs 5 to Rs 10, Below Best and poor sorts were fully firm. Select Best BOP1s advanced Rs 20 to Rs 30, Best types too appreciated Rs 10 to Rs 20, Below Best and poor sorts were irregularly dearer by Rs 5 to Rs 10.
Select Best OPs were firm to Rs 5 to Rs 10 lower at times, however clean Best varieties gained Rs 5 to Rs 10, Below Best and poor sorts maintained last levels. Select Best OPAs were dearer by Rs 5 to Rs 10, the balance were steady.
Select Best Pekoes were firm to Rs 5 to Rs 10 lower at times, the balance were firm on last levels. Shotty Pekoe1s eased Rs 10 to Rs 20, the Best types were firm to Rs 3 to Rs 5 dearer, Below Best and poor sorts were firm to last. Select Best BOP/BOPSP maintained last levels, Below Best types were irregularly lower to last, poorer sorts too shed a few rupees.
Select Best FBOPs were firm, Best types moved up Rs 5 to Rs 10, Below Best types too gained by a similar margin, poorer types were mainly firm.
Select Best and Best FBOPF1s were firm, Below Best types were lower by Rs 5 to Rs 10, poorer types too eased a few rupees.
Select Best Tippy varieties continue to sell at attractive levels and were mostly firm on last, Best types advanced a few rupees above last, Below Best and poorer sorts were met with irregular demand.
Off Grades
Select Best liquoring Fngs1s were dearer by Rs 20 to Rs 25, whilst the Best and Below Best types appreciated Rs 10 to Rs 15, poorer sorts were dearer by Rs 10. All BPs were lower by Rs 30 to Rs 35 and more at times.
Select Best and Best BMs sold at firm levels, whilst the Below Best and poorer sorts shed Rs 15 to Rs 20 and more at times. All Low Grown Fngs were lower by Rs 15 to Rs 20. Select Best BOP1As were firm to lower by Rs 5 to Rs 10, Best and Below Best too were lower by Rs 10 to Rs 20 and more at times, poorer sorts eased Rs 20 to Rs 30.
Dust
Lower demand. Select Best Dust1s were firm, others in the Best and the Below Best category declined Rs 10 to Rs 15, whilst the balance declined further. Clean secondaries shed Rs 10 to Rs 15, whilst the Below Best types declined to a lesser extent, poorer sorts were firm.
Best Low Grown Dust/Dust1s eased Rs 10 to Rs 15, whilst the Below Best types were irregularly lower, balance and the poorer sorts declined further.
source - www.dailynews.lk
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