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| Wednesday, 19 January 2005 |
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Tea industry delegation meets CB governor by Channa Kasturisinghe The representatives of the tea industry including exporters, producers and small holders who met the Central Bank Governor Sunil Mendis yesterday said that the further appreciation of the rupee would gravely affect the industry. A tea broker told the Daily News that the industry delegation informed the Governor that the appreciation of the rupee against the dollar has adversely affected the prices derived by producers and small holders. "There has been a lull at the Colombo tea auction following the sudden appreciation of the rupee. Most categories of tea lost Rs.5 to 10 per kilo and bids were dropped lower last week anticipating further appreciation of the rupee," he said. However, the Central Bank Governor Sunil Mendis told the Daily News that tea exporters need not panic about the appreciating of the rupee against the dollar as other major tea exporting countries too are experiencing the same as far as their currencies concerned. "The Real Effective Exchange Rates (REER) of India has increased by 2.3 percent during the same period when Sri Lanka's REER increased by 2.8. Kenya's currency appreciated by 19.8 percent and Vietnam's by 4.8 percent. I have explained this fact to the exporters," the Governor said. He said the best option of the local exporters is to improve the productivity and quality and cut overheads to face the competition. Tea brokers said however, that there was no shortage of international demand for Ceylon tea and in a few instances prices were even stronger than the previous week in rupee terms. |
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