India’s tea exports continue to slide; domestic auctions indicate positive price trends

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India’s tea exports in 2020 have taken a beating on volume, value and price, compared to the same period of 2019. Till July 2020, for which official data are available with the Tea Board, India’s tea exports nosedived to 115.27 million kg (mkg) from 141.26 mkg during January-July 2019, marking a decline of 18.40 per cent.

Lower availability due to reduction in production, lockdown in many countries in the world’s fight against Covid-19, suspension of transport facilities, disruption of public auctions, hesitancy among exporters to invest huge sums against uncertain shipments and disturbance in banking operations were said to be the major causes of India’s poor performance in tea exports.

With fewer takers, especially at higher prices, the average price of exported tea dropped to Rs 222.05 a kg from Rs 228.17 in January-July 2019, marking a loss of 2.68 per cent. The overall earnings dropped to Rs 2,559.56 crore from Rs 3,223.15 crore, posting a shortfall of 20.59 per cent.

Producers have, however, received higher prices in the domestic market than in exports. While tea prices at auctions across the country have been witnessing continuous slide for the past six weeks with the average price falling by 24 per cent to Rs 204 a kg, there have been a few exceptions.

Jorhat e-marketplace fetched a higher price for the tippy golden flowery orange pekoe (TGFOP) variety of the Chenehi tea farm, selling it at Rs 950 per kg in the latest auction. This was higher by Rs 20 per kg fetched in the previous auction.  The previous highest price of the variety from the same garden was Rs 930/kg, significantly registering an uptick in prices in a week’s time.

The Jorhat auction fetched a monthly average price of Rs 276 per kg during the September 2020 auctions, higher than the prices fetched during the September auctions in 11 districts of Assam. Only Chachar and Sibsagar districts fetched higher prices in the September auctions, Rs 277.93 a kg and Rs 279 a kg respectively. The overall district auction had fetched an average of Rs 214.48 a kg during September 2020.

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