KOCHI: A storm may be brewing in tea prices with both domestic factors and global factors contributing to the change. Tea production has witnessed a slump in the first quarter of 2017 (calendar year) across all the major black tea producing countries. Kenya led the trend with 35.46 per cent drop in production compared with the same period in 2016 followed by Bangladesh at 11.78 per cent slump.
The tea production in North India was down by 19.3 per cent and South India produced 12 per cent lower in the first quarter compared to last year. Industry experts blame climate change and drought like situation in major producing areas for the visible shift. This will lead to an increase in tea price in the short to medium term.
“The weather pattern has changed and it has affected production. However, there is no visible impact on price as it had to be improved owing to shortfall in availability,” said R Sanjith, head (Commodities) of United Planters’ Association of Southern India (UPASI). But he feels it may be because of lower demand.
Accoring to the Tea Board, the production during January-March 2017 was 88.6 million kg , while it was 105.8 million kg during the same period in 2016. “The drop in production is not reflected in prices, which may be because of black marketing. But we are hopeful that GST would bring in traceability,” said Thomas Jacob, chairman, Association of Planters of Kerala.