The Hindu Business Line : Price realisation at tea auctions gains marginally

Chennai June 13 Kenya seems to be gaining from the fall in Sri Lanka's tea production and exports, though the effect has rubbed a bit on India in terms of marginal rise in the average price realisation. During April, production recovered by nine million kg (mkg) to 65.4 mkg, while export rose a tad by 0.1 mkg to 8.9 mkg.

The production gains in April helped in cutting down the decline during January-April to 2.4 mkg. For the calendar year, tea output during January-April has been estimated at 152 mkg.

Dry Phase

However, a cause for concern during April was the fall in production by 3.9 mkg in South India to 23.7 mkg. For the year, it is down to 62.2 mkg from 70 mkg for the year-ago period. In South India, the fall has been more significant in Kerala (3.1 mkg for April and 5.1 mkg for January-April), while Tamil Nadu has also registered some loss.

A major reason for the fall in output has been a prolonged dry phase in the plantations during March-April. The plantation industry had warned that tea production could witness sharp decline during March-June due to the dry weather in Kerala and Tamil Nadu.

Steep Fall

The weather has affected other plantation crops such as cardamom, pepper and coffee also. Besides the weather factor, the crop has been affected by pest attack too.

On the other hand, production in North India has picked up since February and during April, it increased by 12.9 mkg to 45.6 mkg. Overall for the calendar year, it is up at 89.8 mkg (84.4 mkg). Sri Lanka continues to report fall in crop with production slipping by another eight mkg during April. Overall, the output is down 21.7 mkg to 86.8 mkg.

But Kenya has been the factor that has kept on leash any steep fall in global production and rise in the prices. Kenyan production during January-April has increased by 59.3 mkg to 139.2 mkg. The rise is mainly since last year, production was hit due to drought in the African nation. However, during April, Kenya too reported 0.1 mkg fall in production.

Exports

On the export front, Kenya seems to have gained by shipping an additional 16.1 mkg this year. Of this, shipments increased by 12.5 mkg in April alone to 33.4 mkg. For January-April, exports were put at 91.5 mkg (75.4 mkg).

Lanka's exports for the period slid to 70.9 mkg (75 mkg).

The fall in production has been reflected in the volume sold at the auctions. Again, Mombasa in Kenya has accounted for more tea sold at the auctions. In terms of realisation, average price at the Indian auctions has increased to Rs 62.01 a kg from Rs 58.66 last year, while Mombasa has seen the rates dip Rs 13.44 to 71.75. However, in view of the fall in Lankan production, prices at Colombo auctions increased Rs 14.05 a kg.

G.K. Nair reports from Kochi: South Indian tea output is estimated to be lower during the first half of the year due to lack of uniform rains even after the onset of the Southwest monsoon in late May following a protracted dry spell without summer showers.

Lack of effective summer showers and increase in temperature during noon and mist during night had brought down the crop in Nilgiri Wayanad (Gudalur). In Anamallais, severe drought pushed down the output.

In Vandiperiyar in Kerala, they said, extended drought and delayed pre-monsoon showers and protracted drought with about five months of rainless days had affected the crop seriously lowering the output to 3,868 tonnes in January-April this year from 7,014 tonnes in the same period in 2006.

The high ranges of Kerala(Munnar) also experienced severe drought stress this year.

However, in Nilgiris, which had received a rainfall of 45 mm, the output was slightly higher than that of last year. Apart from Nilgiris there was marginal increase in output in Tiruvelveli and Chikamagalur. In Nilgiris, the crop did not move up to the expected levels due to dry conditions and very low relative humidity.