Tea Report

Bartleets Tea Surveillance upto September 12

AT THIS week’s Colombo Tea Auction a total quantity of 5.875 mkg of tea was sold of which 0.772 mkg were Ex-estate teas. Last week’s sale witnessed a quantity of 5.9 mkg and 0.786 mkg respectively.

This week’s Leafy-grade teas showed further improvement across the board except for the BOP1 grade. This could be due to urgent shipments to destinations where the onset of Ramadan is giving rise to added demand or due to local buyers receiving more inquiries for winter buying.

Russia and Germany were very active whilst buyers representing the Middle East were less so.

The Tippy market also gained in strength during the course of this sale as compared with the previous sale for flowery types like FFI’s, FBOP’s and FFX’s. Iran and Dubai played an active role in these grades. Saudi Arabia, Turkey and the CIS played a moderate role.

The latest tea production data for Sri Lanka indicates a rise in output of 10.3 per cent during July as compared with last year. Production totaled 26.2 mkg as compared with 23.7 mkg last July.

However, the total tea production this year, up to July, amounts to 169.8 mkg, down from last year.

Recent weeks have seen a fair share of brain-storming on navigating a future strategy for both the island’s tea industry as well as the global sector.

Director of Corporate Branding, MAS Holdings, recently proposed a six step approach to achieve a higher value for the local industry.

Firstly, a change in the mind-set needs to take place in the sector to transform from a supplier of bulk tea to a brand builder.

Second, two base categories of Blended Ceylon and Pure Ceylon need to be pursued. Next, through environmentally, economically and socially sustainable plantations need to be nurtured whilst also achieving product purity.

Finally, he said that Ceylon teas need to develop strategic retial partnerships. Currently, only Dilmah Tea has broken the ranks to become Australia’s top brand as well as gain prominence in other markets.

However, the tea industry needs large amounts of funding in order to implement the changes that will have a lasting impact. The Director of IPS, addressing a Tea Convention workshop noted that the cess funds that are collected are not directed at the industry and it is a key obstacle to the development of the sector.

He also noted that the lack of motivation, use of old seedlings, poor soil conditions and lack of technical guidance are also having an impact on the productivity of the sector.

Pinnawala mark has once again won the Tea Convention Specialty Tea of the Year Award for the Small Leaf Category for the second year running. They were awarded this price last year for 2005 for both the Small Leaf and the Leafy grades.

Meanwhile, Sri Lanka Insurance has launched an innovative product targeted at meeting the needs of the tea factories. The policy will cover storage, plants, machines, employees, buildings, stock and cash.

Of the 18 plantation stocks monitored 11 have gained, four were down and three remained static.