Strong demand for low grown peko

TEA: The week's two-day Colombo Auction witnessed an overall strong market demand pattern with prices holding steady, week-on-week. An estimated 4.5 Mkgs came under the hammer this week, significantly up from the 4.3 Mkgs of last week.

Commentators remarked that very good tippy teas were down whilst low grown peko types had strong demand, with the bold types doing well.

It was also noted that some degree of panic buying was evident on quality teas due to the lack of availability of quality varieties in the upcoming future sales. Many exporters felt compelled to buy and shippers to Turkey and the Middle East were particularly active.

In the currency market, the rupee's resistance evident during the previous week gave way to further weakening against the dollar closing at Rs. 109.31 on Wednesday as compared to Rs. 107.55, week-on-week.

The latest export data indicates that, despite the trade union action in late 2006, Sri Lanka shipped a record 28 million kilos of tea in November 2006. Comparatively, the period from January to November witnessed a year-on-year gain of seven per cent, totalling 300.3 million kilos.

Russia was the largest customer, purchasing 72.44 million kilos during the eleven month period.Hopes of capitalising on these gains to further boost Sri Lanka's standing in 2007 are also afoot.

The Sri Lanka Tea Board (SLTB) announced this week that the island's exporters will participate in eight international trade fairs that will be held in Japan, United Arab Emirates, Russia, France and South Korea during the first quarter of 2007.

The SLTB has also planned to conduct promotional demonstrations to introduce new uses of tea like cocktails, tea and health seminars, and new tea based recipes like ice tea. New tea gift packs can also be expected at the airport this year.

The overall cause of promoting tea in the international markets got added mileage from the release of a German Research report showing that drinking black tea significantly relaxes and expands the arteries to keep blood pressure healthy.

The European Heart Journal also found that proteins in milk called caseins can block this effect. It is estimated that at least 98 per cent of UK tea drinkers prefer milk in their favourite drink.

Courtesy: Burtleet Produce Marketing