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M.R. Subramani

Production scales another peak of 955.9 mkg

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Chennai Feb. 11 Tea exports topped the 200-million kg (mkg) mark after a gap of three years in 2006, while production scaled another fresh peak of 955.9 mkg on the back of a nearly 10 per cent rise in output in West Bengal.

According to the latest data from the Tea Board, a monthly shipment of 20 mkg from October onwards helped the industry to record total exports of 203.86 mkg last year. The last time the margin was pierced was in 2002, when 201 mkg were exported. In 2005, exports were just adrift of the 200-mkg mark at 199.05 mkg. Industry sources attribute two reasons for the achievement, considered significant in the face of exports being stagnant around 170 mkg and falling share in traditional markets such as Russia and other Commonwealth of Independent States (CIS) nations.

Key factors

Two factors have helped India achieve this. The first one is the gaining market share of Indian tea in the Pakistani market, which consumes 140 million kg annually. While 10 mkg tea were exported during 2005, at least 12 mkg were estimated to have been shipped to the neighbouring country last year.

South Indian plantations have been the major beneficiary of Indian tea's foray into Pakistan. CTC tea from the region is gaining acceptance there. Iran, apart from Pakistan, has also driven the export performance. Shipments to Iraq are estimated to have exceeded at least 30 mkg, though some of the exports have been in the form of re-exports of tea imported from cheaper sources such as Vietnam.

The second factor that helped exports last year was Kenyan production being hit in the first half by a drought. But looking into 2005 performance of the industry, Kenya is not seen as a major factor for the export recovery. Besides Pakistan, there have been efforts to focus on countries such as Pakistan, Iraq, Iran, Egypt and the ones in the Gulf region, according to industry players.

The record production of the crop is 928 mkg produced in 2005. Production has made significant recovery since 2005 after witnessing a decline during 2003 and 2004 due to adverse weather conditions and drought.

Last year, the crop was up in West Bengal by 18.5 mkg to 233.2 mkg, while in Assam, it was up 9.6 mkg to 483.8 mkg.

However, weather conditions had an effect on the production in South India, where it declined marginally by 0.7 mkg to 226.3 mkg.

The fall was more prominent in Tamil Nadu, where 152.3 mkg were produced against 154.6 mkg.

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