Global tea demand-supply gap down

The recovery of the tea industry is not just restricted to the Indian terrain - world tea production is on the verge of reaching a demand-supply equilibrium and prices are showing signs of improvement.

Figures compiled by the Indian Tea Association (ITA) show that on an average in the first six months, production in the different tea producing countries were down by 3.9 per cent to 7.9 per cent.

Some countries registered higher production, but, the increase was only marginal with the exception of Kenya, which posted a 18.4 per cent higher production.

Countries recording lower production were led by India, which saw a decline of 42.3 million kg during January-August, Bangladesh, Uganda and Zimbabwe.

However, mapping crop figures of all the countries reveal that in the first 7-8 months of 2004, lower crop was registered as compared to 2003.

Moreover, exports from producing countries have substantially increased during the first few months.

India recorded a 16.6 per cent increase in exports to 107.7 million kg during January-August, while Vietnam registered a 43.6 per cent increase, Kenya 21.2 per cent, Bangladesh 18.2 per cent, Tanzania 12.9 per cent.

On the whole, exports in the first few months of 2004 was higher than the levels in 2003 by 13.4 per cent or 78.4 million kg.

According to the ITA status paper, if the existing trends in production and exports continued, there would be further correction in world stock position, which in turn would reflect in average price realisations.

Price realisations had already moved up in many of the countries. North Indian tea prices during January-August was at Rs 61.78 per kg as compared to Rs 56.78 per kg. South Indian tea prices were at Rs 70.33 per kg compared to Rs 62.99 per kg.

Prices in all auction centres""Jakarta, Mombasa, Limbe, Colombo""were than the previous year's, with the only exception of Chittagong, which recorded lower prices by Rs 5.37 per kg.