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“It is a welcome move, as it provides the sellers a much bigger buyer base. While there are bound to be some hiccups in the initial stages of implementation, it is a step towards bringing more transparency. We also view it as part of the Digital India initiative,” Pankaj Das, secretary, Siliguri Tea Auction Committee, told this newspaper.
The Association, in league with the Guwahati Tea Auction Centre (GTAC), feels the pan-India e-auction is a step towards digitising the tea trade over the years and present Indian tea directly to global customers.
“However, it will take four to six years for the Tea Board to fully implement auctions on the electronic mode and reach out globally. This mode is the future of the tea trade,” Dinesh Bihani, secretary of GTAC, told this daily.
While Sale Number 25 (the pan-India e-auction lot) initially met some opposition from brokers, buyers and sellers lobbies, resulting in the Tea Board negotiating and postponing the sale by two days, the morning hours in South India clearly gave a verdict in favour.
The entire volume on offer at the Coonoor auction centre totaling 1.12million kg (kg) was sold. Big corporates, including Tata and HLL bought the teas on offer. However, participation in Kochi centre was disappointing, with 50 per cent of tea on offer were sold. The rest is expected to be offered on Friday when Coimbatore auction centre would join in. Guwahati finished 67 per cent of the 4.5 mkg catalogue by 4 pm.
“The sale is running smooth and every section of buyers, from the big houses to western Indian buyers to small packeteers are participating,” said, Kalyan Sundaram, secretary of the Calcutta Tea Traders Association.
However, the Siliguri catalogue, comprising mostly the Dooars and Terai variants, did not take off. Sources in the Siliguri tea trade said as little as 20 per cent buying had happened so far.
“Since the Tea Board did not permit proxy buying in this e-auction, local buying is not taking place. Also, there is a virtual boycott of this auction here,” a person in the trade told this newspaper. As much as 85 per cent of the Siliguri sale is dependent on local buying. “The absence of local buying has affected the sales here. Although I expect it to go as high as 89 per cent when it concludes, proxy bidding is a requisite,” said Bihani.
It was the large buyers — Hindustan Unilever, Goodricke, Tata Tea and others of this stature — which participated extensively in the first day of the national auction. Sale 25 will go on for two and a half days. A series of negotiations had resulted in a two-day postponement. The earlier dates were planned on June 21, 22 and 23.
The pan-India e-auction was mainly mooted by the Union commerce ministry, to help small growers fetch a better and fairer price, by giving wider access for their produce instead of limiting them to particular auction centres.
“In the long run, this will definitely help small growers but the issue of credit needs to be solved,” said Bijoy Gopal Chakraborty, president of the Confederation of Indian Small Tea Growers Association.
E-AUCTION: A QUICK GLANCE
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First manual tea auction in India took place in 1861 in Calcutta (Now known as Kolkata)
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Manual tea auction continued for over 150 years; first was held in 2009
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An avergae of 40-45 per cent tea sell through the e-auction
- Previously, the registered buyer with an auction centre was able to bid directly in any auction of the same centre but with the new pan-India e-auction, buyers from any part of India can bid in any auction of any centre
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Fetching better prices to sellers/growers
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Participation of buyers in all auction centres with single registration
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Uniform auction rules across all centres
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Introduction of electronic auction of Darjeeling tea
- Ensuring generation of delivery orders from the system only after actual realisation of payments
