Crop shortfall leads to higher tea prices at auctions

The shortfall in production due to the lockdown and the subsequent rain in tea growing region has led to a rise in price realisation of the beverage at the auctions, officials said on Sunday.

As per data provided by the Calcutta Tea Traders Association (CTTA), prices of CTC and orthodox varieties, Darjeeling leaf and dust have increased significantly in sales which took place at the city auction centre in June and July, they said.

Compared to the last year, the crop shortfall during the January-June period of the current calendar year was around 15 crore kg, Indian Tea Association (ITA) secretary-general Arijit Raha said.

"Production of tea in north India, comprising North Bengal and Assam, was down by 40 percent from January to June this year," he said.

According to the Tea Board data, tea production in north India was 37.2 crore kg during the first six months of the last year, which has gone down by 14.9 crore kg during the same period of 2020.

The production was mainly down due to the lockdown, the industry sources said, adding that the erratic rainfall in north India in July have also added to the shortfall.

Raha said the price rise due to lower output is a 'temporary' phenomenon.

The tea industry had been complaining about lower price realisation until last year.

This year, the average price per kg at the auction was around Rs 60-70 higher for all categories of tea, the CTTA data suggested.

Even the small tea growers are getting better prices for their produce this year, a source in the ITA said.