By Steve A. Morrell
Tea brokers said the crises in the Middle East and North Africa were having little or no effect on prices at the Colombo auctions, with demand dropping in Kenya and India as Ceylon Tea gains momentum.
"Crisis or not people in the Middle East have to drink their Tea, especially Ceylon Tea. This is much like what happened during the second world war, where British soldiers continued to demand for Ceylon Tea," a leading tea broker told The Island Financial Review, describing better prices at the Colombo auctions last week.
Volume at the auctions was high last week at 8.2 million kilos, despite bad weather and quality concerns.
Chairman Asia Siyaka Tea Brokers Anil Cooke said, "Management levels on plantations are of a higher standard and planters are now better prepared for any debacle than ever before. Estates have new skills putting them in a state of readiness to face crisis situations. This was not so several years ago."
"The Middle Eastern market cannot be replaced, and with attempts to find newer markets being slow, sales pitch to remaining markets must urgently intensify," he said.
Meanwhile, crop declines in Kenya and India are expected to see a revival of prices in Colombo, Cooke said.
Comparative auction prices for 2009 and 2010, showed that Mombasa and Calcutta were behind Colombo because of renewed demand for Ceylon Tea. World production figures showed that tea prices in Colombo were well above Kenya and India. Malawi and Bangladesh were the only other producers who were ahead of Sri Lanka.
Sale quantities this week would be high at 7.9 million kilos. Next week too sale volume would be 8.1 million kilos. Brokers said they did not expect prices to drop, although there would be sufficient tea to go round.
Sources from the Western sector and Nuwara Eliya say a predictable weather pattern has emerged and monsoon conditions would be the norm. Depleted crops have been reported from high and middle elevations, but low growns seem to be having boom times.
Tea brokers reported good demand last week. Low elevation teas sold well.
Over the past two years the Uva season was all but non-existent. This year hopes are high that the warm Kachan winds expected mid July across Uva would result in high value teas from expected areas in Uva.
Particularly the Malwatta valley, transcending the high lands spanning Bandarawela and Attampetiya. Also included are the low plains of Lunugala, or the lower Uvas.
source - www.island.lk
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