The Hindu Business Line : Tea output declines in January-March

THE national tea crop has registered a shortfall of 6.56 million kg during the first three months of 2004, according to official estimates released by the Tea Board.

The Board further announced that, during the same period, exports from India have registered a growth of 7.2 million kg compared to the same period in 2003.

The low production of tea has continued even in April, mainly in North India, which comprises Assam, the Dooars and the Terai.

"Arrival of teas at the primary auction centres in the North has shown a sharp decline following lower crops harvested," according to sources in the Tea Board.

The immediate effect of this production shortfall is likely to be on tea prices. A section of the tea auctioneers say that tea prices have already hardened and are likely to go up further.

It may be noted that, for the last three to four years, the Indian tea industry has been witnessing a poor phase. While tea production went up, prices fell sharply. Exports of Indian tea also suffered for various reasons.

"Arrival of CTC tea, which are preferred in the domestic market, have shown a decline of 0.75 million kg in the month of April and prices are Rs 6.94 per kg higher than in the same period of 2003. For the auctions in May, tea arrivals have shown a further decline of 5.8 million against last year," the sources said.

Despite such bullish sentiment among Tea Board officials, a section of the industry feels it is too early to celebrate. This group feels that corrections can take place in June or July when tea production reaches its peak.