Agri Business

Traders’ association sees tea output plunging by 80 mkg

Our Bureau Ahmedabad | Updated on May 25, 2020

India’s tea industry is staring at a massive 80-million kg (mkg) decline in tea production this year as a fallout of nationwide lockdown and shortage of workers for harvest due to the Covid-19 outbreak.

Industry insiders noted that the tea harvest which usually starts from March was halted for at least two months – March and April – due to market disruptions and labour shortage.

India’s annual tea output hovers around 1,300 million kg.

“We expect tea production in 2020 to fall by around 80 million kg. This would result into a loss of ₹2,000 crore for the tea industry,” said Viren Shah, Chairman, Federation of All India Tea Traders Association (FAITTA).

In the North-East region, the harvest takes place between March and November. Of the four flush season during the period, the first flush begins from March. It is believed that the initial two flush yield better quality leaves. Trade sources revealed that due to the two months of lockdown, tea leaves grew older. It necessitated pruning of the plants to make way for fresh leaves. Most tea gardens in the region are currently in the similar state.

Shah further stated that the federation has made a detailed assessment of the lockdown effects on tea production, supply as well as demand.

Tea industry had to face a double blow. On one hand, it had escalating costs due to lockdown to deal with, while on the other the industry faced slowing consumption from the bulk segments such as hotels, restaurants, offices.

Annual domestic tea consumption is estimated at around 1,080 mkg.

The Federation said that while production costs have gone up, job losses, pay cuts, and large-scale migration of workers , are serious constraints for packers and retailers to hike tea prices.

Published on May 25, 2020

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