The five-member committee is constituted by Basudeb Banerjee, the Tea Board vice-chairman along with DL Thapar of The Assam Company, Gautam Bhalla of Warren Tea, Bharat Arya of JV Gokul and Co, Arun Grover of HLL and R Sen of J Thomas & Co.

According to an industry official, the committee has been formed to ensure a smooth functioning of the auctions and to check unprecedented price rises. It is believed that the Tea Board vice-chairman himself will visit the auction houses once a month to ensure that trading activities are carried on without any hitch.

Of late, the tea market has been witnessing a downward slide in tea prices. This was specially notable at the last two auctions when average tea prices slipped by substantial amounts, almost by Rs 30 for the premium and good CTCs and by Rs 20 for the medium andaverage varieties, compared to last year's levels. Industry circles are finding it difficult to understand the sharp downward trend in tea prices, witnessed during the last two weeks at both Calcutta and Guwahati, the main auction centres.

According to PO Desai, chairman of the Federation of All India Tea Traders' Associations (FAITTA), the reasons attributed to the reduction in prices may be because buyers who procure tea either through auctions or ex-factory contracts ultimately have to sell their product to consumers either in loose or branded forms.

Moreover, owing to drought conditions in Assam and West Bengal during February and March, high tea prices prevailed at the auction centres and buyers had very little option, but to buy teas at Rs 110 to Rs 140 per kg in April, he said.

High prices compelled regional packet companies to increase their prices as a result, said Desai. But this was a difficult situation as consumers did not accept the prices, as a result of which there was a decrease in theofftake. This could be yet another reason for it to be reflected in the auction prices.

With the market taking an interesting turn, it remains to be seen whether the current trend will continue for some time now. The production levels of the the May crop will have its reflection on the price levels in the existing market, industry observers said.