Tea export gains in volume, but unit value down

Tea exports have increased by about ten million kg between April and October 2006, but earnings are expected to be lower according to Commerce Ministry sources.
The sources told The Hindu that Egypt, Iraq, Pakistan and Kenya had increased their imports of Indian tea. Since most of the teas were the cheaper varieties, prices had been lower. Kenya, the world's largest exporter, had been buying Indian teas for re-exports after blending. `It stepped up its purchases this year,'' the sources said. It suffered a crop shortfall till early this year owing to a drought.
The Indian Tea Association (ITA) and the Tea Board have identified Pakistan, Iran and Egypt as the major thrust countries for tea exports. A tea delegation from Pakistan visited India in April last and had elaborate tea-tasting sessions, besides meeting with exporters in north and south India. Pakistan is among the largest importers of CTC teas with annual imports of about 140 million kg. However, with Kenya catering to the bulk of the market (with a 62 per cent share), India's share was only about nine million kg — a record high achieved in 2005 — after concerted efforts. With the momentum being maintained this year, exports are likely to touch 18 million kg this fiscal, according to industry sources.
Referring to Iraq, the sources said that a seventy per cent increase in export levels (19 million kg exports in 2005) to West Asian countries was envisaged during 2006-07. The ITA and the Tea Board planned to set up a business centre in Egypt to get a foothold in this market , which consumes about 72 million kg of tea annually.

The sources said that with these trends, total exports were expected to be about 200 million kg against 181 million kg in 2005. However net exports were higher since there was lesser imports from Vietnam.
The sources said tea export volumes were more important to determine the domestic tea prices (and the fortunes of tea companies), since volumes create a balance between production and domestic consumption. Between January and September, India's tea output increased by 3.5 per cent to 704 million kg.
Source: thehindu.com