Tea industry pegs exports estimate for the year lower by 15 m kgs at 190 m kgs

Our Commodities Bureau

Chennai, Dec 2: The cup of woes of the tea industry is filled to the brim with exports during 2001 poised to be substantially lower, following a host of adverse factors including major importers switching to high quality tea from other origins. This is on the back of a sliding prices and lower unit value realisation for Indian tea in the international market.

According to top industry sources, the total tea exports during this calendar year is expected to be lower by 15 million kgs to 190 million kgs from the 205 million kgs exported during the previous year. Lower imports by major buyers like Russia and Commonwealth of Independent States (CIS) are the major reason behind the decline in exports in this calender year, they say. According to the data available, tea exports during January-July this year was to the tune of 75,160 tonnes compared to 71,004 tonnes exported during the same period previous year. Exports remained lower in each months during the April-June period this year as compared to the exports in same months last year. Tea exports to Russia and the CIS have been in the troubled waters for quite some time as low quality Indian tea is being replaced by good quality tea from Sri Lanka and other competing origins, sources said. “Quality is the major problem that is hitting Indian tea in the international market.

Bulk of the commodity tea exported from south India and Assam are of inferior quality leading to rejection by the buyer countries”, says industry sources.

According to them, while good quality Orthodox leaf tea from Darjeeling, Assam and Nilgiris still finds a ready market overseas, it is the poor quality CTC tea that has been suffering in the international market.

“Growers should focus on enhancing quality than production if they want to survive in the international market. Consumers have high expectations and with the competition increasing, there is less chance for selling inferior quality tea even at lower prices”, they said.

Sources also said that there has been a steady erosion in the brand equity of Indian tea in the international market following the export of inferior quality tea.

They said People’s Republic of Libya had early this year banned the import of tea from India as a shipment of three million kgs was found to be “unfit for human consumption”.