Association officials feel that the sector has been passing through the darkest phase and plunging prices, closure of several estates and stiff competition from other other producing countries would make things tough for the sector.
Plantations have a vital role in the economy of the South. Almost all plantation and spice crops are grown here. South India accounts for 23.5 per cent of the national tea production and practically 100 per cent of coffee, natural rubber, cardamom and pepper output. India has maintained its top slot in tea producing 826.2 million kgs despite a 3.2 per cent fall in production compared to the previous year.
India had a share of 27.3 per cent in the world market. But during the first six months of this year, there was a 10 per cent increase in tea production compared to the corresponding period last year. South India had a marginal 0.9 per cent growth from 98 million kgs to 98.9 mkgs.
Indias export share was up by 8.5 per cent from 182.6 to 198.1 million kgs. But during the six months of this year there was a decline with South India showing a disturbing trend exporting just 27.6 mkgs compared to 44.9 during the period last year.
Though world over prices started declining since 1999, during 2002 India was the only country that recorded a negative growth in prices with South Indian tea registering a negative 3.6 per cent.
A major threat to the industry after the removal of quantitative restrictions was the flow of low priced teas into the country. Coffee global production was up from 111.8 mkgs to 125.1 mkgs, but India registered a negative production as the total production was 2.75 lakh tonne compared to 3 lakh tonne the previous year. The forecast for this year was lower at 2.5 lakh tonne.
Exports dropped drastically to 1.9 lakh tonne last year from 2.1 lakh tonne. Around 80 per cent of Indias coffee is exported. Value realization also declined to Rs 964.7 crore from Rs 1,050.4 crore.
Rubber production in 2002-03 was up at 6.49 lakh tonne from 6.31 lakh tonne. In the case of consumption there was an increase from 6.3 lakh tonne to 6.95 lakh tonne. Import too had declined. As per Rubber Board estimates, production this year was expected to be up to 6.85 lakh tonnes and consumption 7.12 lakh tonne.