Bartleet Produce marketing Tea Surveillance Report:
Selective buying from UK, Europe
Due to a one-day sale, the quantity of tea arriving at the Colombo
Auction this week decreased sharply to 5.735 mkg from 8.175 mkg traded
in the previous sale. The Ex-estate crops too showed a decrease from
1.507 mkg to 1.300 mkg.Market Segments: In the Ex-estate segment, the
overall market showed a decline compared to last week and is expected to
continue on this downward adjustment in the upcoming auctions too. The
main reason is that the teas which have been cropped are getting
plainer.
As a result of this, extremely selective buying was witnessed from
the UK and other European shippers whilst Japan too showed a very
selective buying pattern. The trend is expected until better teas reach
the auctions.
In the Tippy market segment, good demand was witnessed where buyers
from Iran and Dubai were active whilst buyers from the CIS were moderate
in their purchasing patterns.
Strong demand for the Leafy grades was also evident. Except for the
OP1 and BOP1 grades, the rest were firm to dearer. There were few
enquiries from Iraq and Libya which served to lift the bottom OP and
OPA's.
April Crops: Tea production for the month of April totalled 31.69 mkg
as compared with 30.81 mkg in March 2008. When compared with last years
crops, it represents an increase of 31.68 per cent.
The sharpest rise took place amongst the High elevation teas that
recorded 7.813 mkg in March 08 as compared with 4.734 mkg in March last
year. The 65 per cent pick-up in quantity can be explained with
reference to the industrial action and poor weather experienced last
year.
Meanwhile the Medium elevations also posted a rise of 44 per cent
with 5.712 mkg and the Low grown's gained 11.99 per cent to post 15.777
mkg.
Indian Stats: Tea exports had rebounded in March by 20 per cent, on
demand from Pakistan and Egypt, but production declined nearly five per
cent, mainly due to a fall in harvest in North India. According to Tea
Board data, exports during March were 16.02 mkg against 13.32 mkg during
the same period a year ago.
There has been quite a recovery in tea exports, especially from the
south during March. Exports statistics from the south during March were
up at 7.7 mkg, against 6.4 mkg the previous year.
Exports picked up mainly on shortfall in the Kenyan crop.
Estimates suggest the global shortfall at 62 mkg and this is not a
small quantity according to sources. The Kenyan tea crop has been hit
this year by adverse weather conditions and political unrest.
The drop in Kenyan production has led to countries, such as Egypt and
Pakistan, to turn towards India. South Indian tea, in particular, has
gained from the circumstances. Sound Bites: This week, the Sri Lankan
Ambassador in Germany got a chance to speak and made the best use of it
according to the German media.
He spoke of the unique success story achieved by one of the four
largest tea exporters in the world, Hewa Tea and More, founded in 2003,
in a small warehouse at Markische Straise. It reaped success quickly and
moved to Herpinger Weg in 2006.
Today the manager and his six member team are looking after 2,500
clients all over Europe.
The Russian market is to be opened up through a branch office.
Another branch office is planned for Canada.
Plantation stocks: Talawakelle Tea Estates Ltd which is managed by
Hayleys Plantations, saw its net profit after tax increase by 189.4 per
cent, year-on-year to Rs. 87.8 million in the first quarter ended March
31, 2008.
With reference to the weekly surveillance of the 19 plantation
stocks, nine were lower in value whilst four reported a marginal gain
and six reported static. Malwatte Valley plantations witnessed a
marginal gain of three percent, week on week.
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