Tea prices, which have been subdued in the last two months, have started firming up.

Prices are likely to inch up further, backed by a steady demand and the arrival of better quality second flush crop (May-July) into the market, sources said.

According to Krishnan Katyal, Chairman and Managing Director of J. Thomas & Company Ltd, the price gap between last year and this year’s crop (CTC and dust) has been narrowing.

The average price of CTC and dust were lower by Rs 26 a kg in Sale 23 (June 3-7) in Kolkata tea auction compared to the same period last year. The differential, however, started narrowing down, and in Sale 26 (June 24-29), CTC and dust were lower by less than Rs 3 compared to last year.

“In Sale 26, prices almost converged with the last year’s levels. We are already seeing better prices in the current Sale 27. We expect prices to move up this year backed by a steady demand and the arrival of quality crop,” Katyal told Business Line.

Higher offerings

The offerings at the last few auctions have been largely dominated by the first flush and the not-so- satisfactory quality tea - Bhanji crop - produced in the lull period between the first flush and the second flush.

Offerings of CTC and dust between Sale 20 and 27 in Kolkata tea auction was close to 22.41 million kg (mkg), (19.12 mkg last year).

“The higher availability of CTC and dust during the last few auctions had brought down prices,” a senior industry official said.

Quality Tea

According to C.S. Bedi, Managing Director of Rossell Tea, quality teas have been commanding good prices and ruling higher by 10-15 per cent on an average.

“The demand is pretty strong and prices of good quality tea will continue to remain firm,” Bedi said. During January-May, production of tea in North India was up by 3.7 per cent to 57 mkg. While 41 mkg was produced in the Assam region; another 16 mkg were produced in West Bengal.

> shobha.roy@thehindu.co.in

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