A total of 5 million kg came under the hammer this week, and there was good demand, according to Forbes & Walkers Tea Brokers.
Ex-Estate offerings totalled 0.67 million kg, the lowest quantity on offer since September 2018. The quality of offerings was barely maintained. In the backdrop of the sharp decline in availability, prices for most teas on offer appreciated Rs 20 per kg and more, with the lower end of the BOPF gaining up to Rs 50 per kg. Once again, the improvement in demand was centred on the tea for price category, which has further narrowed the parity between the better teas and teas at the lower end of the market.
A total of 2.3 million kg came up for sale in the Low Grown Leafy/Tippy catalogues this week, where there was good demand. In the Leafy catalogue, BOP1/OP1’s were fully firm to dearer. Better OP/OPA’s commenced fully firm, but gained a further Rs 10-15 per kg towards the close. Others too were fully firm.
PEK1’s were fully firm to dearer, whilst PEK’s too were mostly firm, barring the teas at the Below-Best category, which were irregular. In the Tippy catalogue, select best FBOP’s were irregular, whilst others and FF1’s were fully firm. At the lower end, prices were fully firm to irregularly dearer.
In the Premium catalogue, better teas were fully firm to selectively dearer, whilst others maintained. There was good demand from shippers to Turkey, Iraq, Saudi Arabia, Dubai and Syria this week.
SRI LANKA TEA PRODUCTION – OCTOBER 2019
Sri Lanka Tea Production for the month of October 2019 totalled 20.8 million kg showing, a decrease of 8.9 million kg, vis-a-vis 29.7 million kg of October 2018. All elevations have recorded a decrease YOY, with High and Low Grown elevations showing a fairly significant decline.
January-October 2019 production totalled 253.7 million kg, recording a marginal gain of 0.98 million kg
vis-a-vis 252.7 million kg of January-October 2018. On a cumulative basis, Mediums and Low Growns have shown growth, whilst High Growns have shown a decrease YOY.
CTC production for the month of October 2019 of 1.9 million kg shows a fairly substantial decrease of 0.84 million kg vis-a-vis 2.8 million kg of October 2018. With the exception of Low Growns, where a marginal increase is recorded YOY, High and Medium Growns have shown a significant decrease.
On a cumulative basis too, January-October 2019 production of 19.2 million/kg shows a decrease of 0.8 million kg vis-a-vis 20.0 million kg of January-October 2018. On a cumulative basis, High Growns and Medium Growns have shown a decrease, whilst Low Growns have remained static.
SRI LANKA TEA EXPORTS – OCTOBER 2019
Sri Lanka Tea Exports for the month of October 2019 totalled 25.8 million kg vis-a-vis 23.3 million kg of October 2018, showing a gain of 2.5 million kg. All main categories of exports (i.e. tea bags, packeted tea and bulk tea) have shown a growth YOY.
Total revenue derived out of tea exports for October 2019 totalled Rs 20.6 billion, recording a gain of Rs 0.9 billion vis-a-vis Rs 19.7 billion in October 2018. However, total FOB value of Rs 798.75 for October 2019 shows a decrease of Rs 47.97 vis-a-vis Rs 846.72 of October 2018.
January-October 2019 cumulative exports of 246.9 million kg show a gain of 11.3 million kg vis-a-vis 235.6 million kg in January-October 2018. Here again, all categories of exports (i.e. tea bags, packeted tea and bulk tea) have shown a growth YOY, while revenue for the period January-October 2019 of Rs 203.1 billion records a gain of Rs 10.7 billion vis-a-vis Rs 192.4 billion in January-October 2018.
Consequently, the FOB value for the period January-October 2019 of Rs 822.69 recorded a gain of Rs. 6.26 vis-a-vis Rs 816.43 in January-October 2018.
Iraq has emerged as the number-one importer for the period under review, followed by Turkey and Russia. Other noteworthy importers are Iran, Libya, China, Azerbaijan, Syria and the UAE. Meanwhile, the USA, India and Germany show a fairly significant growth in imports during the period under review when compared to the same period of the corresponding year.