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Tea producers and traders are a worried over low volume sales despite falling prices. The auctions of Coonoor Tea Trade Association (CTTA) began 2020 with a lower earning.
In the four auctions held in January, producers sacrificed prices by as much as ₹16.32 per kg to liquidate unsold teas. Nevertheless, 1.13 million kg less tea was sold than in January 2019, reveals our analysis of the Market Reports.
When producers allowed the prices to rule at moderate levels so as to push up sales, the average prices dropped to ₹83.61 a kg from ₹99.93 in January 2019. Nevertheless, demand was inadequate to absorb the teas even at the lower price. Consequently, the volume sold dropped to 5.41 mkg from 6.57 mkg.
As a result, the overall earnings dropped to ₹ 4.52 crore from ₹ 6.57 crore. This meant that the earnings fell by as much as ₹2.05 crore or 31.20 per cent in just one month.
If this trend continued unchecked, the overall earnings in 2020 would be about ₹24 crore less than in 2019. Week after week, 30 to 40 per cent of the offer remained unsold in CTTA auctions so far.
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