Tea exporters fear dip in export volume in current year

By: |
October 16, 2020 2:55 PM

The exporters also complained about the lack of availability of shipping containers due to fall in imports which has also led to a steep rise in freight rates.

Chairman of Indian Tea Exporters Association (ITEA) Anshuman Kanoria said that exports last year was around 252 million kilograms as per Tea Board data. (Representational image)

Indian tea exporters fear that there will be a drop in export volume in the current year due to higher prices available in the domestic market, particularly of the CTC variety.

The exporters also complained about the lack of availability of shipping containers due to fall in imports which has also led to a steep rise in freight rates.

Chairman of Indian Tea Exporters Association (ITEA) Anshuman Kanoria said that exports last year was around 252 million kilograms as per Tea Board data.

“But this year we are fearing that the export volume will dip to 180 million to 185 million kilograms as offtake of orthodox tea by Iran had declined and the CTC variety is not being able to compete with Kenya and Africa due to high ruling domestic prices in India.

Kanoria said that Iran is the largest importer of orthodox variety from India which was 55 million kilograms last year.

“But this volume of exports to Iran is going to be down due to some payment problems with that country. This year exports to Iran will be around 30 million to 35 million kilograms. We have apprised the commerce ministry of the problem”, Kanoria added.

He said that CTC exports have been badly hit due to high domestic prices. “There has been a good CTC crop in Kenya and Africa this year and so the prices have softened. These countries are making inroads with CTC tea in the export market as prices are low compared to India”, he said.

The other problem the tea exporters are facing are lack of shipping containers, he said.

Since imports have come down, availability of shipping containers have declined at the ports. “Due to this, freight charges have increased by a minimum of 50 per cent and this is eroding away the competitiveness of Indian tea in the export markets”, he added.

Kanoria said that as export markets are shrinking this year, it will be difficult to regain them when things become normal next year.

According to him, tea prices this year has hit a high due to crop shortfall caused by prolonged closure of the gardens due to the pandemic.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1Yes Bank posts Rs 129 crore net profit in Q2
2IDBI Bank swings to profit on lower provisions, improved asset quality
3JSW Steel net profit falls 37% to Rs 1,595 crore in Q2