Tea exporters to Iran, one of the largest markets, are facing uncertainties as the buyers from the West Asian country have stopped signing fresh contracts.
After a gradual drop of exports for the last two years due to payment issues, shipping container shortages and the pandemic, year shipments of Indian tea to Iran was rising till a weeks ago, on the back of improvement in container availability and easing of freight rates. Apart from tea, Iranian buyers haven’t been registering for imports of basmati rice from India too, over the last many weeks.
Export of tea to Iran stood at Rs 515 crore in January-September 2022, up 7.3% from the year ago period.
There is a lack of clarity over the reasons for Iranian buyers’s reluctance to get into new contracts with Indian exporters. Importers in Iran have to get proforma registrations from the authorities before shipments are allowed.
“We have received several reports from exporters that their importers from Iran are having trouble registering new contracts. We do not know the reason for it. We have requested the government to look into it and apprise us of the situation,” Indian Tea Exporters Association chairman Anshuman Kanoria told FE.
There have been unconfirmed reports attributing the situation to anti-hijab protests in Iran and geo-political situation. A section of export community also since India stopped importing kiwi and apple from Iran, the Iranian authorities may have retaliated by stopping imports of tea and basmati rice from India. But these assumptions too are unsubstantiated and there is no official word on this yet. “As soon as India allows the imports of kiwi and apple, Iran may also allow importing Indian tea and basmati rice,” a trader said, requesting anonymity.
“Iranian importers are not registering new proformas, they are not giving new import licences. At the moment they are importing tea under contracts signed earlier,” said Anup Kumar, managing director, SSK Exports Ltd.
According to sources, the Tea Board India has received representations from the trade about the issue. Apart from India, Iran buys teas from Kenya, Indonesia, China and Sri Lanka.
“Iran is a very vital market for us, especially for Assam orthodox tea. This year export to that country was rising compared to last year. Demand for Indian orthodox in Iran was rising as a result of our marketing initiatives there. But now the situation is tea shipments to Iran from India have stopped. We have not got any information about the Iran issue from the government so far,” Sujit Patra, secretary, Indian Tea Association (ITA), said.
In the calendar years 2021 and 2020, Iran imported around 26 million kgs and 35 million kgs of tea, respectively, from India. While Iran has remained the second largest importer after Russia, other major importers of Indian tea are the UAE and the US.