The Hindu Business Line : Tea industry warms up to Iraq orders

THE much-awaited demand for tea from Iraq is all set to hit the Indian market. According to industry sources, an order of anywhere between 15-20 million kg (mkg) is expected from Iraq by the end of January.

Tender for the purchase has been floated by Iraq and the last date for it was recently changed from January 15 to January 20. The orders will be placed on the producing countries. It will take 30-45 days after the tender has been issued for the contract to come to letter of credit (LC) stage, sources said.

A moot point is that these contracts will not be under the oil-for-food programme and, in fact, are fresh demand for the year.

Among those export houses that have reportedly given their quotes are the Kolkata-based Limtex (India) Ltd, Rajrani Exports, Ambo Exports, Northern Projects Ltd, and the Kochi-based Algayathri Exports.

Dwindling purchases from Iraq, a traditionally strong market for India, have been an area of concern for the industry. Exports to Iraq during January-October 2003 slipped to 4.1 mkg from 39.7 mkg for the corresponding period last year. Given this backdrop, the fresh demand would appear to signal better times ahead, with regard to Iraq, for the industry.

Yet, there appears to be some dispute over the quantum of order that is to come in with a section of traders is of the view that it is much too soon for a final quantum to be quoted. "There is no denying that India stands a good chance of getting a sizeable quantum this year from Iraq, particularly because there is to be no third country mandate exports. However, only once the tender is closed and the quantity is allotted as confirmed orders, will we able to talk of a final figure," sources said.

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