The Hindu Business Line : Major suppliers shy away from exporting tea to Iraq

The reluctance of major suppliers in exporting tea to Iraq due to payment problems has dragged down its shipments during January-September this year. The development comes even as exports to other destinations, barring Pakistan, have begun to show an upward trend.

‘Outstanding’ problem

“None of the major suppliers is ready to give tea to Iraq and no one is willing to send any consignment.

There is a huge outstanding from the country and we hear diplomatic talks are on to get recover it,” industry sources, who did not wish to be identified, said.

Exports during January-September declined 37.16 million kg (mkg) to 118.74 mkg compared with the same period a year ago.

Exports have been continuously falling every month and during September, they fell 4.83 mkg to 15.33 mkg year-on-year.

According to the sources, South India has been mainly bearing the brunt of the fall in exports.

“Exports to Pakistan this year are also down because Kenya, where crop was affected last year due to drought, has come back in a big way,” the sources said.

“Otherwise, exports especially of orthodox tea are moving well and we are witnessing some pick up in that,” they said.

Break up in export figures available till June indicates that there has been a steep fall in shipments to Iraq.

During the period, it slid to 3.35 mkg against 23.42 mkg last year. Shipments to Pakistan during the period slid to 2.21mkg against 5.79 mkg.

Exports from Kenya, whose production till August increased by 63.2 mkg to 244.3 mkg, increased by 35.7 mkg to 183.3 mkg.

However, the unit value realisation during January-June improved to Rs 95.73 a kg from Rs 83.92.

According to the sources, exports could be considerably lower around 180 mkg this year against over 200 mkg shipped last year.

Production

Meanwhile, production during January-September also dropped.

During the period, the output has been pegged at 689.2 mkg against 706.8 mkg. Decline has been mainly in North India, particularly Assam, where it has dropped by over 10 mkg.

In Assam valley alone, the drop has been 11.2 mkg. In September, production in North India slid to 27.1 mkg from 3.31 mkg with fall in output being witnessed both in Assam and West Bengal.

In the South also, heavy rains have affected production. Kerala accounted for 5.3 mkg fall, while Tamil Nadu has reported an one mkg increase.

In September, a 0.4 mkg increase in Tamil Nadu’s output helped make up a similar fall in Kerala. Karnataka has reported a marginal rise in production.

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