Domestic demand is holding the price of dust tea, while low-key exports is cause for drop in the price of orthodox varieties. The major exports from Kochi are to CIS, Russia and other east European buyers like Poland. There are a few enquiries from west Asian countries too.

Exporters to these countries are operating only on good quality orthodox grades. Quality is the watchword for exports, said a leading tea trader of Kochi. Incessant rains for more than one month have affected the quality of the commodity which has arrived at the centre. This has also dampened the activity of select buyers.

The tea traders in Kochi are expecting exports to improve after July. The prices are going toremain low in the coming weeks, said a top tea broker. The tea industry in the south is also banking on the International Tea Convention to be held at Kochi on September 6 and 7.

Major importers of tea from various countries, producers and traders in India as well as some leading authorities on health are expected to attend the convention.

The convention is being organised by the Tea Board in association with the United Planters Association of Southern India and the Tea Trade Associations of South India. Traders are expecting tea demand to peak by then coupled with the rise in price.

The Kochi centre auctioned 22.76 million kg (mkg) of tea between January and May 1999 at an average rate of Rs 63.20 a kg compared to 22.96 mkg at the rate of Rs 83.21 per kg in 1998 during the same period. Tea auctioned at Coimbatore during this year was marginally higher in quantity with 7.15 mkg against 7.06 mkg. But the price of the commodity is lesser by about Rs 24 on a kg. In 1999, the average price till May was Rs56.67 a kg while in 1998, it was Rs 79.44 till May.

The decline of tea prices was not because of over production during the year, said leading tea traders here. In fact, South India produced 57.8 million kg from January to April this year while during the same period last year it was 60.4 million kg.