PRODUCTION - 4 ::

LED BY INDIA, GLOBAL BLACK TEA PRODUCTION FALLS

BY P S SUNDAR

                  With leading producing countries officially announcing their output data, it is now clear that because of India’s lower production, the global black tea output in 2014 has trailed behind 2013.

“According to our compilation, the global black tea output in 2014 dropped to 2177.75 million kg (mkg) from 2184.87 mkg”, Rajesh Gupta, compiler of ‘Global Tea Digest 2014’ told me corroborating my predictions a few months ago that loss in India's production would offset gains in other countries.   He had asked me over a month back whether the global tea output would regain.

  

This was the first time in recent years that production has fallen over the previous year although the drop is only marginal at 7.12 mkg. 

India led the decline with as much as 15.61 mkg, producing 1184.80 mkg.    Here, North India lost 15 mkg to produce 943.62 mkg and South India, 0.61 mkg to produce 241.18 mkg.

Sri Lanka lost 3.42 mkg to produce 336.60 mkg.  Malawi’s production fell marginally by 0.56 mkg (production: 45.91 mkg), Bangladesh’s by 0.80 mkg (65.45 mkg), Malawi’s by 0.56 mkg (45.91 mkg) and Uganda’s by 0.25 mkg (55.34 mkg).

“On the contrary, Kenya posted a sizable increase of 12.65 mkg to produce 445.10 mkg”, Gupta said.

Black tea accounts for the largest volume among the different types of tea produced in India.    India continued to top the global black tea table in 2014 although China produced the largest volume of all kinds of tea put together.

Kenya and Sri Lanka followed India at a distance in the production of black tea.

TEA AND TOURISM -- 1::

FOREIGNERS GET PROFESSIONAL TEA TASTING EXPERIENCE

BY PS SUNDAR

                     Visitors from Germany, Indonesia and Nepal benefited from the unique experience of ‘professional tea tasting’ of many Nilgiri tea varieties, thanks to value-enhancement ‘Tea and Tourism’ session organised by Kothari Agricultural Management Centre (KAMC) IN Coonoor on Feb 18, 2015.

“Two German ladies are on ‘tea tour’ in South India, through COMINDIA, an organisation promoting Indo-German tourism venture.  Three officers of National Tea and Coffee Development Board, Nepal, and one officer from Research Institute of Tea and Cinchona, Indonesia, are on a programme sponsored by Government of India”, KAMC Director Dr AVK Iyengar told me.

On his request, I gave a brief orientation on the global and Indian tea situation with accent on the Nilgiris tea.   I also introduced them to the tourism impact of tea.  More importantly, I took them through ‘wellness’ factor of tea – its anti-oxidant, anti-carcinogenic, oxidation, cholesterol reduction, endothelial, Polyphenol, digestion, dermatological, nerves, bones, dental and mental alertness.  I rounded off highlighting the hospitality and eco-friendly role played by tea.  These were well-appreciated.

Following this, Tea-Tasting expert Baskaran guided them through first-hand experience of valuing tea through appearance, infusion, liquor colour, strength and flavour besides using tongue’s taste buds.   Many varieties of Nilgiri teas were used for tasting.   The visitors took some such teas with them.

Differentiating from the black teas were the multiple brewing Avataa green tea varieties.  “In this Avataa collection, I prefer Avataa White and Avataa oolong teas.   I am taking them back with me”, Tigges Roswitha from Frankfurt said.

“My preference is Avataa Silver tip tea and I believe it has value for money”, added Klinz Rotraut from Berlin.

Chhimkala Acharya, Ful maya Anybo and Suresh Raut from Nepal as also Januar Budhi from Indonesia showed their appreciation to the different tea varieties in the Nilgiris.

PRODUCTION -3 ::

INDIA PRODUCED 16 MKG LESS IN 2014

BY P S SUNDAR

It is now official.  Tea Board of India has just released the December 2014 production data.  And, our compilation corroborates what we have been predicting almost three months ago – that the output in calendar 2014 would hover around 1183 million kg (mkg) as the production totalled 1185 mkg.  Even in my post 'PRODUCTION - 2' in this blog on January 19, 2015, I had projected 1183 mkg. 

For the first time in recent years, India’s tea production has fallen below the previous year. “This has happened in calendar 2014.  The country’s overall production has fallen to 1184.80 million kg (mkg) from 1200.41 mkg in 2013”, Rajesh Gupta, compiler and publisher of ‘Global Tea Digest 2014’ told me.  

Still, it is the second highest production in India’s tea history.   The country crossed 1,000-mkg-mark for the first time in 2011 when production soared to 1116 mkg.  Production rose further to 1126 mkg in 2012 and to 1200 mkg in 2013.   But, in 2014, production has fallen by 15.61 mkg over the all-time high output of 2013.

The biggest loss came from North India while South India lost just marginally.  North India contributed to 15 mkg fall and South India, 0.61 mkg fall.

North India’s production dropped to 943.62 mkg from 958.62 mkg.  Assam continued to top India’s tea table but its production fell to 589.77 mkg from 621.87 mkg. West Bengal, however, posted an increase in production to 329.31 mkg from 312.88 mkg.

South India’s output dropped marginally to 241.18 mkg from 241.79 mkg.  Here, Tamil Nadu was the only state to produce a lower output.  Its production dropped to 168.93 mkg from 173.36 mkg.   Kerala’s output rose to 65.52 mkg from 62.84 mkg.

Collectively, some highlights of Indian tea production in 2014 ::

# Assam Valley pulled down the production  by as much as 35 mkg -- the highest loss suffered by any producing region in the country;  and because Cachar produced 2.90 mkg more, collectively, Assam's production was down by 32.10 mkg -- also the highest loss for any state. 

# it was not a good year also for Darjeeling tea, hailed as the champagne by the tea world, as production was 0.62 mkg less than 2013. 

# Adverse weather is said to be main culprit 

# Cachar, Dooars and Terai tea hubs as also the states of  Kerala and Karnataka produced more tea than 2013.

# India, Malawi and Uganda were the only countries where production fell in 2014 over the previous year.  Still, unlike India, Malawi and Uganda lost only a marginal volume.  

COONOOR AUCTION - 5:: 

TEA  AUCTION TURNOVER DOWN Rs 5.70 Cr

BY P S SUNDAR

                     Nilgiri tea producers and traders have lost Rs 5.70 crore in the opening month of 2015 at Coonoor Tea Trade Association auctions.

This has happened because the volume sold in January 2015 was 3.56 lakh kg less compared to January 2014 despite producers slashing prices by Rs 5 per kg, 

During most auctions of last year, prices ruled the least of the past few years due to low demand.   In December, a rising trend was seen with prices increasing week after week.  This trend continued in January 2015; still, prices could not reach the levels of a year ago as demand continued to be inadequate.

In January, five auctions were held when prices averaged Rs 75.85 per kg against Rs 80.93 in January 2014.  Still, the volume sold was only 5.48 million kg (mkg) against 5.84 mkg in January 2014.

Consequently, the overall turnover dropped to Rs 41.56 crore from Rs 47.26 crore in January 2014.  This loss of Rs 5.70 crore marked a decline of 12.06 per cent.

However, producers are hoping that prices will reach last year’s levels this month.   In February’s first auctions, prices rose to an average of Rs 80.55 per kg – the highest since May 23, 2014.  Homedale Estate tea, auctioned by Global Tea Brokers, topped overall Crush-Tear-Curl market and Dust auctions when Shree Ram Tea Trading Co bought it for Rs 214 per kg.  Darmona Tea Industry topped the Leaf auctions at Rs 196. 

 Vigneshwar Estate got Rs 185, Deepika Supreme Rs 182 and Navilkal Estate Rs 180. In all, 80 marks got Rs 125 and more.

The Orange Pekoe orthodox leaf tea of Chamraj was the only grade to exceed Rs 300-a-kg mark and it fetched Rs 301 a kg.  Glendale got Rs 281, Kairbetta Rs 260, Kodanad Rs 243, Havukal Rs 233, Prammas Rs 220 and Highfield Estate Rs 215. In all, 47 marks got Rs 125 and more per kg.

Quotations held by brokers indicated bids ranging Rs 49-53 a kg for plain leaf grades and Rs 90-165 for brighter liquoring sorts. They ranged Rs 60-64 for plain dusts and Rs 110-180 for brighter liquoring dusts.

There was some purchase for Pakistan in a wide range Rs 73-111 a kg.

FOR THE RECORD - 3::

ARTICLE IN THE ASSAM REVIEW & TEA NEWS (JANUARY 2015)

BY P S SUNDAR

PROMOTION - 3 :: 

INDIAN TEA DELEGATION TO RUSSIA NEXT WEEK

BY P S SUNDAR

Tea Board Chairman Siddharth will lead a delegation to Russia from Feb 9 to 15 coinciding with ‘Prodexpo 2015’, the biggest trade event in Moscow.

The visit is being guided by Tea Board’s Moscow office.

Representatives of McLeod Russel India Ltd,. Jayshree Tea Industries, Godfrey Phillips India Ltd., Golden Tips Tea Co Private Ltd, Balaji Agro, Vikrama Impex, Arrum Exporters, Limtex India, Primiers Tea, Indu Tea, JFK International, Bagmahi Group and North Western Cachar Tea Company are among those in the delegation.

Tea Board will hold a special pavilion of 84 square metres in Prodexpo where companies including Jayshree, Primiers Tea, Limtex, Arrum, JFK international, Golden Tips and Godfrey Phillips will display products.

The delegation will have meetings with major buyers including Orimi Trade May Company, Ahamed Tea, Nadin Tea, Rubin Tea, Riston , Mac Tea and retail chains like X5, Magnit and Seven continents.

The delegation is also scheduled to meet the officials of the Ministry of Economic development, Russian Customs, Rospatent, Rusteacoffee Association, central bank and other major banks.

A Buyer-Seller meet is also being planned.  The delegation will present an exclusive event of Indian Tea in a cultural village ‘Ethanomir’.

Russia is the single largest importer of Indian tea and CIS countries, including Russia, account for as much as 25 per cent of India’s overall exports.  While this itself has enough reasons to justify the delegation to Prodexpo, an equally significant factor is that the delegation is visiting in the backdrop of Russia’s import of Indian tea falling in the recent past.  

Russia which imported 49 million kg (mkg) from India in calendar 2011, imported only 46 mkg in 2012 and 40 mkg in 2013.  The imports have fallen further in 2014 and as per the latest data available with Tea Board, till November, Russia purchased only 34 mkg from India against 36 mkg during Jan-Nov 2013. This means, Russia’s import of Indian tea in 2014 is likely to be only 38 mkg – the least since 2006.

The need to boost tea exports to Russia arises also from the reality that it has imported two mkg less in 2014 despite offering the teas for Rs 10 or 28 US cents less per kg.   The average price of Indian tea exported to Russia till  November was Rs 155.61 a kg against Rs 165.07 in the same period of 2013.  In US dollar terms, it was $ 2.56/kg against $ 2.84 in 2013.

Consequently, the earnings from tea exports to Russia have crashed to Rs 530.49 crore from Rs 600.68 crore in 2013.   In dollar terms, the earnings have fallen to $ 87.15 million from $ 103.18 million.   

Russia, and for that matter, the erstwhile USSR, had traditionally been a major importer of Indian tea.   Time was when producers used to manufacture CTC teas exclusively to suit the Russian palate.   Over the years, Russians started showing preference to orthodox teas but the voluminous availability of such teas in India was a concern to them.   Indian producers were concerned about the low price offered by some Russian importers – even last week, some teas were bought at Coonoor Tea Trade Association auction for as low as Rs 47 a kg while the auction average itself was Rs 79.35.

In this backdrop, the real success of the delegation will come about if an impression is left with Russian importers of (1) the availability of quality Indian teas of different grades suitable to them so as to be sure of supplies in future; (2) the need for them to pay prices matching with quality and as determined by global market; (3) signing deals to cover immediate, short and long term business. 

Business transaction as a factor to gauge the success of such delegations arises because many delegations of the past had been exchanged resulting in goodwill.  Now, ‘make in India’ concept of Modi Government expects business transactions to materialise.