Monday, May 30, 2011

John Keells Tea Market Report

Monsoon likely to affect crops

The South West monsoon appears to have started to develop over the Island, which will lead to heavy and incessant rain. From May to September the South West monsoon will sweep across the Western central highlands unloading heavy rains on the mountain slopes and emerge as dry winds on the Eastern slope of the central hills heralding the start of the Uva quality season which is famous for its distinctive flavour.

It’s a period when the tea bushes undergo severe stress conditions on account of the harsh weather and consequently, crop intakes from both sectors will show a substantial drop.

Depending on the severity of the monsoon these rains can bring gale force winds and lashing rain in the South Western quarter.

Sri Lanka Tea Crop for the month of April 2011 at 28.4 mkgs is 5.6 percent below the corresponding month of 2010. Although High Growns have once again recorded a gain during the month Medium and Low Growns have both recorded shortfalls.

As at end April, Sri Lanka production at 106.3 mkgs reflects a gain of 2.1 mkgs over last year which in fact was a record year.

Last week’s large volume of 1.8 mkgs. of Ex Estate teas commenced at firm levels and appreciated as the sale progressed by Rs 10 to Rs 15 for most invoices.

However prices were not sustained and once again tended lower towards the latter part of the sale.

A fair weight of Low Grown, High and Medium CTC PF1s remained unsold on account of little or no interest. Russia was selective, whilst the Tea Bag sector lent only fair support. UK, Japan and Continental buyers too were very selective.

The 3.9 mkg of Low Growns that came under the hammer last week, met with better demand. In the Leafy category, although prices of Main Grades commenced on a lower note, gained as the sale progressed, but dipped again towards the latter part.

In the Small Leaf category, the well made teas appreciated in value, whilst at the bottom end prices declined further. With the large volume on offer, it is clearly evident that most markets are looking at well made teas with the poorer sorts been neglected.

Western Teas

Select Best BOPs were firm to Rs 5 dearer, other good invoices gained Rs 5, Below Best and Plainer varieties were firm to dearer. Select Best BOPFs declined Rs 5 to Rs 10, other good invoices were irregularly dearer, Below Best sorts which were Rs 10 dearer eased as the sale progressed, plainer varieties too followed a similar trend. Medium BOPs shed Rs 5 to Rs 10, whilst the BOPFs declined by a similar margin and substantially more for the poor leaf sorts.

Nuwara Eliya Teas

Brighter BOPs declined Rs 10 to Rs 15 and more, others were firm to Rs 5 dearer. Brighter BOPFs declined substantially whilst the others were firm to marginally dearer.

Uva Teas

BOPs declined Rs 5 to Rs 10, whilst the BOPFs were firm to irregular. Uda Pussellawa BOPs advanced Rs 5 to Rs 10 whilst the BOPFs were irregular.

CTC Teas

Low Grown CTC PF1s declined Rs 5 to Rs 10 with a large volume remaining unsold. BP1s declined Rs 20. High and Medium PF1s shed Rs 10 and more as the sale progressed with a large volume remaining unsold. BP1s advanced Rs 5 to Rs 10 on average.

Low Growns

Lower demand. Select Best OP1s were firm to dearer by Rs 5 to Rs 10 whilst the balance were irregularly lower Rs 5 to Rs 10 and more at times.

A few Select Best and Best BOP1s were firm to Rs 5 to Rs 10 dearer, however the Below Best and poor sorts tended lower by Rs 5 to Rs 10. Select Best along with the Best OP/OPAs eased Rs 5 to Rs 10, the balance too declined by a similar margin and declined further as the sale progressed.

Select Best and Best Pekoe/Pekoe1s were firm to Rs 3 to Rs 5 dearer at times, however the balance shed Rs 10 to Rs 15, flaky types were firm. Improved demand was witnessed for Tippy/Small Leaf category.

Select Best BOPs advanced Rs 5 to Rs 10, Best types maintained last levels, Below Best types gained Rs 5 to Rs 8, poorer types gained Rs 5. Select Best BOP. SPs were firm, Best types gained Rs 5 to Rs 10, Below Best sorts were firm, poorer sorts were easier by Rs 5.

A few Select Best FBOPs advanced Rs 5 to Rs 10, others maintained last levels.

Best types moved up Rs 5 to Rs 8, Below Best types were irregular, poorer sorts were irregularly lower to last. Select Best and Best FF1s moved up Rs 5 to Rs 10, Below Best and poorer sorts too moved by Rs 5 to Rs 8.

Select Best tippy varieties met with improved demand and gained above last, Best types too gained Rs 10 to Rs 20, Below Best and poorer sorts were irregular.

Off Grades

Select Best liquoring Fngs1s appreciated by Rs 10 to Rs 15, whilst the Below Best and poorer sorts advanced Rs 10. Select Best and Best BMs appreciated by Rs 5 to Rs 10, whilst the poorer sorts were dearer by Rs 10 to Rs 15. All BPs sold at firm levels. All Low Grown Fngs were lower by Rs 10 Select Best BOP1As along with the Best appreciated Rs 5 to Rs 10 and more at times whilst Below Best and poorer sorts were firm to dearer by Rs 10 to Rs 15 from last levels.

Dust

Select Best Dust1s were firm. Improved teas in the Best and Below Best category appreciated Rs 5 to Rs 10 whilst the balance were firm. Poorer sorts declined Rs 10 to Rs 15. Clean secondaries were firm whilst the balance gained Rs 5 to Rs 10. Best Low Grown Dust/Dust1s were firm whilst the balance gained Rs 10 to Rs 15.
source - www.dailynews.lk

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