Rising labour cost, falling output spoil the party
Retail tea prices are set to increase by Rs 10 to 12 a kg from April due to fall in output and sharp jump in labour cost.
Labour cost in tea producing centres such as Darjeeling, Assam and Bengal has gone up substantially leading to rise in operational cost, said Mr Arun N Singh, Vice Chairman of Indian Tea Association and Managing Director of Goodricke Group in a statement on Thursday.
The recent wage revision of tea workers by 34 per cent in the gardens of West Bengal and the likely hike in salary revision in Assam may push up cost resulting in retail tea price hike, he said. Nearly 2.2 million people are directly employed in the Rs 10,000-crore tea trade in the country.
Assam is the largest tea producer in the country with 500 million kg a year, followed by Bengal having 240 million kg a year tea production capacity.
The country has produced 985 million kg of tea in 2011 as against 966 million kg produced in 2010. Exports are expected to touch 190 million kg against 193 million kg recorded in 2010.
The remaining 795 million kg will be available for the local market while the domestic demand is pegged at 860 million kg, there will be shortage and price increase in tea, said Mr Singh.
Mr Harendra Shah, President, Federation of Maharashtra Tea Traders Association and Chairman, Federation of All India Tea Traders Association said that the quality of tea produced by many tea estates has improved in last few years, but the packaging standards have not been up to the mark, resulting into deterioration of quality along with spillage and pilferage. ITA should recommend good and effective packaging of tea to all its members, he said.