After touching a 15-year low of 195.5 million kg (mkg) in calendar year 2021, India’s tea exports will likely rebound this year by about a sixth to around 230 mkg on the back of rising demand from Iran and UAE. The industry and the Tea Board are optimistic about the growth prospects of exports this year, which are aided by improving logistics and container availability.
Shipments during the first half of 2022 in volume terms stood at 96.89 mkg as per the provisional estimates by the Tea Board — an increase of 12 per cent over the same period last year’s 86.46 mkg.
Sujit Patra, Secretary, Indian Tea Association (ITA), said there is a good demand both for the Indian CTC and orthodox teas in the international markets.
“This year we expect to recover to some extent the losses made in certain markets. The unprecedented economic crisis in Sri Lanka has given some hope to Indian tea in the international market. Though initially Russia-Ukraine war put some road blocks, the situation is rapidly turning into normalcy and exporters are getting a lot of queries. I expect, India can achieve a level of 225-230 mkg in 2022 with higher exports to key markets like Iran, Iraq, UAE, Saudi Arabia, Russia, USA, Turkey, and Poland,” Patra said.
In value terms, shipments for the period registered a growth 9.79 per cent at ₹2,532.67 crore over the same period last year’s ₹2,306.77 crore. In dollar value terms, the exports stood at $332.28 million, up 5.6 per cent over the same period last year’s $314.52 million, while the per unit realisation was down 2 per cent at ₹261.40 a kg as against Rs 266.80 in the same period a year ago.
Sourav Pahari, Chairman and Deputy Chairman, Tea Board, said the exports have actually picked up despite large buyers such as the CIS and Iran facing problems due to the current international situation.
Russians pay premium
“The Russians are picking up more orthodox teas at premium prices and so is the case with Iran. Once the currency thing is regularised, the exports will pick up. We are optimistic of growth in exports,” Pahari told BusinessLine on the sidelines of the UPASI annual meet in Coonor early this week.
Orthodox tea shipments have increased by 22 per cent during the first half at 48.62 mkg compared with 39.70 mkg a year ago. In value terms, the orthodox tea shipments stood at ₹1,269.69 crore (₹1,042.15 crore). The exports of CTC teas grew marginally at 41.12 mkg (40.32 m kg). However, in value terms, the CTC shipments declined to ₹900.75 crore (₹965.89 crore).
Tea shipments to CIS countries in the January-June period were a tad lower at 20.58 mkg (21.04 mkg). The shipments to the UAE registered a whopping 134 per cent increase at 15.86 mkg (6.76 mkg), while exports to Iran were also up at 11.43 mkg (10.04 mkg). Exports to the US, Germany and China among others declined during the period.
Trade sources said the improving logistics situation this year with availability of containers should also support the shipments this year. Exports were affected last year due to covid related restrictions, high ocean freight, lack of enough containers and uncertainty in realising payments from Iran. Also, the government’s decision to set a very low reward rate for tea under RODTEP has also adversely impacted export competitiveness.
“The industry has requested the Commerce Ministry to allow Tea Board to mount trade delegations in key markets to give exporters an opportunity to meet said.