The plantation industry in Tamil Nadu has sought immediate Government intervention for a bail out from the impending crisis.

“It is unprecedented; if not checked immediately, the situation would only worsen and running this industry would become economically unviable in the years to come,” V Suresh Menon, Chairman, Planters’ Association of Tamil Nadu said.

Caught between under recovery in price realisation on the one hand and heavy crop loss due to pests and diseases on the other, the tea industry in the State is heading towards a looming financial crisis.

The average price at the tea auctions slipped almost by ₹7/kg to ₹80.75 during the first seven months of the current calendar year compared to the corresponding period of the past year. This is much lower than the production cost of a kg of tea in TN, which is hovering at around ₹125. This cost of production includes not only wages and wage-related  payments, but also cost of inputs.

Coupled with this, tea plantations have, during the past three months, registered heavy crop loss ranging between 30 and 40 per cent due to pest and diseases including severe attack by tea mosquito bugs. As there was no expected crop to be harvested, several man days have also been lost resulting in huge monetary loss in price realisation, Menon said.

The association has appealed to the State to do away with the discriminatory VAT rate on sale of tea by the corporate tea factories, relax land reform provisions by permitting crop diversion and sharing of social costs among others.

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