South Indian teas seem to have been largely insulated from the price crash witnessed in North Indian CTC dust grades a few days ago on account of pesticide-related issues.
Though dust prices fell by ₹2-3 in sale number 25 this week at Cochin, traders attributed the decline to increased arrivals, thanks to ideal growing conditions in the high ranges. The quantity offered in the Cochin auctions was 10,97,109 kg, with a majority of the medium and plain browner teas remaining unsold on lower demand.
On pesticide-related issues, industry sources said plucking in North India is normally carried out in seven-eight days and there is every chance of higher residual levels in teas. However, plucking in South India happens in a 28-30 day cycle, with lower chances of residues.
Following EU norms
Sources said tea gardens in South India are mainly owned by corporates, which follow all the European Union norms related to tea shipments and exports. However, with around 50 per cent of the production coming from small tea growers - both in South and North India - there is a risk of presence of residues in tea manufactured by BLF’s/estate factories, which buy leaf from these small growers.
N. Lakshmanan Chettiar, a tea planter in Madurai, said tea research institutes should update the beneficiaries on MRL issues periodically as a lack of working knowledge is a limiting factor.
Despite good overseas buying, especially from CIS countries, only 59 per cent of the 4,66,032 kg of orthodox leaf grades offered in the Cochin auction were sold. The subdued sales were attributed to the delay in receiving final contracts; sales are expected to pick up in the coming weeks, traders said.
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