October 27, 2007

• Indian tea exports likely to slip below 203 million kgs

   

  

   

  KOCHI: Payment defaults, rise in global production and appreciation of rupee have combined to pull Indian tea exports this year. The exporters feel that the tea export from India is likely to close much below 203-million kg achieved last year. The India tea export in January to August stood at 103.09 million kg compared with 122.50-million kg in the same period of the previous year. The decline has been for the South Indian tea, which fell by 26.5 million kg.
  
  North Indian tea exports gained by over 7-million kg as it comprised mostly Orthodox variety of tea going to Russia and CIS, which are still active buyers. It was Iraq’s change from hero to villain in a matter of months that hit the South Indian tea industry most. The largest buyer of Indian tea in 2006, the country is being shunned by Indian tea exporters now due to heavy payment defaults.
  
  Iraq had purchased 40-million kg of Indian tea in 2006, which was higher than that bought by Russia and CIS, which have been traditionally the largest buyer of Indian tea. “Exporters are avoiding Iraq as payment arrears of previous exports run into crore of rupees. Even when the country floated fresh tenders, exporters were reluctant to participate,” says tea exporter Krishnakumar J Shah.
  
  For the six-month period of January to June, Iraq’s purchase of Indian tea amounted to 3.35-million kg against 23.42-million kg in the same period last year. If Pakistan turned out to be a promising destination for Indian tea last year, the general rise in global production particularly in Kenya, has put paid to that hopes. In the January –August period, Kenyan production has jumped by 34% to 244 million kg.
  
  Kenya, a regular supplier of tea to Pakistan, was not able to meet the full quota last year because of a drought. This led Pakistan to look towards India. But this year Kenyan supply to Pakistan has improved considerably much to the disappointment of India.

  • 4:17 am
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