The Hindu Business Line : Tea output dips 9 pc; exports increase 22%

THE fortunes of the tea industry appear to be brightening with a nine per cent production fall in the first seven months of 2004 and a simultaneous 22 per cent increase in exports.

According to statistics released by the Tea Board, production during January-July 2004 dropped to 384.46 million kg (mkg) from 419.93 mkg during the same period in 2003.

All the tea growing regions in North India and South India, barring two, have registered a fall.

The two regions that recorded growth are Terai of West Bengal in North India and Karnataka in South India.

The main producing regions such as Assam, Darjeeling, Dooars, Tamil Nadu and Kerala have recorded fall.

During January-July, the total North India production dropped by 10 per cent to 277 mkg from 305 mkg.

Similarly, South Indian production dropped by 7.5 per cent to 106 mkg from 114 mkg.

The fall in production has been welcomed by the industry.

"It will help the tea trade to get rid of the surplus stocks, which has accumulated over the years due to over production," sources said.

South India registered marginal fall because last year production was abysmally low.

Production in the Terai region went up due to the bought leaf factories.

Sources said the bought leaf players had increased their production when they got a hint that there was a possibility of a price rise during the year.

Exports, both in terms of volume and value, have registered growth.

In volume, they went up by 22 per cent to 93.6 mkg from 76 mkg. Export earnings increased to Rs 771.12 crore in 2004 from Rs 764.74 crore in 2003.

Though the Tea Board has not disclosed the exact quantity of exports to different destinations, sources in the industry said the major markets continued to be Russia, Kazakistan, the UK, the UAE, Iraq, Kenya and others.

The growth in exports came mostly due to a magnificent show by the South Indian tea industry.

During January-July 2004, exports jumped by 60 per cent to 56.6 mkg from 35.1 mkg in the corresponding period in 2003.

Export earnings also increased to Rs 332.06 crore from Rs 248.88 crore.

Sources said that South India was making up for the ground it lost in 2003.

"During the corresponding period in 2002, exports from this region were 55.4 mkg. So, South India has not only made up for the lost ground but has gone ahead," they said.

Exports from North India, however, suffered. It dropped by 7.5 per cent to 37 mkg from 40.9 mkg.

Export earnings also dropped to Rs 439.05 crore from Rs 515.86 crore.

The average unit price during the first seven months also dropped from Rs 100.52 per kg in 2003 to Rs 82.35 per kg in 2004.

In North India, it dropped to Rs 118.55 per kg from Rs 125.90 and in South India, it fell to Rs 58.66 per kg from Rs 70.91 per kg.

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