By Steve A. Morrell
First, tea prices dipped. Then the weather convulsed the plantations. With expected South West monsoon rains failing to show up. Debilitating influences such as those seen over the past few months left the plantations in an anxious situation. Added to their woes, the wage hike did not quite project stability. On the contrary added cost had the estates struggling with spiraling cost of production (COP) recording losses of about SLR. 90. Per kilo. Overall tea did not sustain its known resilience. The small holders too have not had run-away profits.
The Sri Lanka Tea Board (TB), through their announcement dated 19th July, indicated June crop was below last year. The minus quotient being about 2 million kilos. Highest crop differences were recorded in the low grown elevations very nearly 2 million kilos. However performances to end June was only about 400,000 kilos ahead of 2010.
Yet the West Asia crisis that engulfed the tea market waned somewhat. Buyers prompt deliveries are now attracting immediate payment provoking vigorous bidding at the weekly auctions.
Last week brokers reports said there was good general demand but at reduced rates. 1.5 million ex-estates came under the hammer. Asia Siyaka Weekly report said few select coloury BOP and BOPFs sold well but was not the regular price trends.
Uva teas sold well. Perhaps a precursor of better times ahead because of expected Uva quality.
Uva quality is not experienced anywhere else in the world. Usually the Uva season lasts at most about three weeks. Severe drought conditions are experienced from Haputale to the Lunugala basin.
Of significance is that most Uva holdings are land tracts in excess of 1500 acres covering excellent tea land. But also of importance is that yields are barely 20 kilos per acre each month during the Uva season. The Uva season is usually June through August each year. Prices have to be at premium parallels or compounded losses would be substantial.
Uva Teas are bought by Japan, France, Germany, and of recent years good news was that the US too entered the Colombo auctions, brokering sources said.
Colombo is still the most expensive auction centre in the world. January to June performance was 338. Dollar cents per kilo. Mombasa, 256.,(Kenya), Kolkata, 270. Comparing other beverages, for instance, Coffee Robusta, selling at 161. And cocoa at 329. Tea continued to remain at an extremely high average These details were gleaned from the Asia Siyaka Tea report.
With the West Asia crisis situation gradually receding prices would pick up, these sources said.
Meanwhile news from Viet Nam, was that they hope to boost exports of tea shortly. This would further influence Colombo for lower net sales averages.
source - www.island.lk
No comments:
Post a Comment