A declining trend in the prices of orthodox leaf tea is reported to have prompted some manufacturers in North India with dual production facilities to convert their produce into CTC grades, said traders at Kochi auctions. 

According to traders, orthodox prices in North Indian markets have been declining for quite some time and this might have forced some producers to shift to CTC considering the domestic market demand for dust grades. This will lead to a situation where the dust offerings in the auctions would be on the higher side in the coming weeks. However, traders went on to that such a practice has not been reported from any South Indian auctions so far.

Downtrend continues

Meanwhile, orthodox leaf prices continue to decline in Kochi auctions with a drop in sales percentage at 51 out of the offered quantity of 3,83,165 kg. The average price realisation was down by ₹ seven at R130 compared to ₹137 in the previous week.

The auctioneers Forbes, Ewart & Figgis said that the prices continue to be lower with heavy withdrawals for almost all grades because of the subdued export demand from CIS and West Asia.

Traders also said the quality of tea was also dropped due to rush crop because of rains.

At the same time, dust market continues to be steady and firm, thanks to Onam sales which is fast approaching, traders said. They have also voiced a concern for the subdued buying by government agencies, as last year they had procured nearly eight lakh kg from the auctions to supply tea in the Onam kits ahead of festival season.

The quantity offered in CTC dust sale was on the increase at 9,55,437 kg, witnessing a ₹ one rise in the average price realisation at ₹128. Good liquoring teas were steady to firm and sometimes dearer following quality. Blenders absorbed 60 per cent of the total CTC quantity sold. Kerala loose tea traders and upcountry buyers lent fair support.

Exporters were the major stakeholders in orthodox dust with an offered quantity of 9,000 kg and 91 per cent sales.

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