The Hindu Business Line : Industry, Tea Board differ on output figures

Tea production figures have assumed a lot of significance more so after Indian Tea Association (ITA) in its Status Paper 2006 forecast that there would be shortfall of 27 million kg (mkg) by the end of the year.

Tea Board in its monthly report has stated that during July 2006, production in North India rose 17.9 million kg (mkg) to 121.7 mkg from 103.8 mkg in July 2005.

During the January-July period, production was up by 16.3 mkg at 337.1 mkg (320.08 mkg). Dooars and Terai regions have registered the highest growth both in July and in the January-July period.

Down in South

In South India, in the first seven months total production is down by 8.2 mkg. From 137.9 mkg it has dropped to 129.7 mkg. Total Indian tea production has, however, increased by 8.1 mkg and ended at 466.8 mkg.

In Assam valley, production has increased to 200.5 mkg but in Cachar it is down by 3.1 mkg at 20.1 million kg in January-July period. However, in July, production was stagnant at around last year's levels.

However, ITA in its Status Paper had already stated that due to unfavourable weather condition tea production in the first half of 2006 was down by 10 mkg compared with the corresponding period in 2005.

Soon after the publication of the Tea Board figures, Mr Shashank Prashad, Senior Vice-President of Tea Association of India (TAI), in a statement said there was an over-estimation and an immediate correction was necessary.

"In none of the tea producing regions, in any month of the year, the production ever exceeded 15 per cent of the annual production of the same region. Further, if the figure of increase is correct then Dooars and Terai would have produced in July, 51 per cent more than what it produced in July 2005, an incredible increase," TAI stated.

The association apprehended that the Tea Board figures, if not rectified, would cause "instability" in the tea prices and would also have "dislocating effects" in the demand-supply position.

Till now ITA has remained silent despite the fact that the Tea Board figures go against its recent assumptions.

Some of the major domestic buyers have already rejected the conclusions drawn by the ITA Status Paper. According to them, it is a futile exercise on the part of the producers to jack-up the tea prices.

Exports

Regarding exports, Tea Board has stated that it was up by 4.05 mkg in July at 19.11 mkg. This is the third consecutive month that exports are up.

In the January-July period, exports increased from 95.63 mkg to 98.18 mkg.