TEA REPORT

Bartleet Producemarketing Tea Surveillance Report upto August 13

The quantity of tea arriving at the Colombo auction this week decreased to 6.757Mkg from 6.805Mkg traded in the previous week’s sale. Meanwhile, the Ex-estate crops too showed a decrease from 0.782Mkg to 0.694Mkg.

Market segments:

In the Ex-estate segment, brighter teas were quite strong whilst the lighter and the plainer varieties were not shown much interest.

Meanwhile, the quality buyers such as Japan, UK, Europe and Russia were quite strong in the market picking up whatever that was brighter due to the fear of the irregular weather which would hamper quality.

This situation drove the buyers who had a seasonal or a spread buying pattern to change and pick-up whatever was available at any given time of the year.

Meanwhile, the smaller grades were thinning out in quantity due to most of the high growns shifting into leafy grades.

But industry sources are anticipating that the high growns will eventually shift to the smaller leafs in the future weeks as the leafy market has shown a drop in the past few weeks.

In the Tippy market segment, fair demand was witnessed where Iran was very selective in their buying whilst CIS and Dubai were moderate in their buying patterns.

In the Leafy grade segment, due to various reasons, the market took a dip this week too. With the fasting period around the corner and with the congestion in the ports in Middle East countries paved the way to a drop in price. The most hampered grade was Pekoes.

Final call

The Lanka Estate Workers Union has appealed to take action to revamp the management of the estates presently run under the Janatha Estates Development Board, State Plantation Corporation and Elkaduwa Plantations Ltd.

The Union had appealed to the President to direct the authorities to recommission the tea factories of Hunasgiriya, Elkaduwa, Kallebokka, Allagolla, Rangala and Pitakanda Estates which had been closed down on unsubstantial grounds that there are no funds to repair these factories.

It was further argued that with the current growth trend in the tea plantation sector it is a pathetic situation that these authorities don’t take mileage of the situation. Sources also claim that the estates run by the above institutions are not managed properly and the tea factories have been closed down, a trend that could lead to utter ruination.

Financial reports

Maskeliya Plantations PLC recorded a robust turnover of Rs. 776 million for the first quarter ending June 2008 which was a 31 percent increase over the corresponding period in the previous year. Estate level gross profits improved by 122 percent to Rs. 121 million whilst profits from operations after management fee increased by 319 per cent to Rs. 71 million.

The company recorded a net profit after tax of Rs. 52 million compared to a loss of five million rupees in the corresponding period last year.

Meanwhile, Horana Plantations in the June quarter saw net profits increase by nine percent, year-on-year to Rs. 8.4 million whilst Malwatte Vally Plantations ending the June quarter saw net profits increase by 133.6 per cent year-on-year to Rs. 298.4 million. Cumulative net profits in the first half ending June 30, 2008 increased by 73.4 percent year-on-year to Rs. 380.7 million.

Watawala Plantations profit after tax had grown to Rs. 405.9 million from Rs. 221.7 million the previous year and the group’s after tax profit was Rs. 404.4 million.

Kotagala Plantations Ltd meanwhile in the financial year ended March 31, 2008 saw revenue grow by 26 percent year-on-year to Rs. 2,749 million while profit after tax in the period under review grew by 29 percent year-on-year to Rs. 495 million.

Development fund

The Plantation Development Project (PDP) has approved a Rs. 2,333 million long-term credit facility for 14 regional plantation companies. These funds are mobilised to be invested in field, factory development and for mini-hydro power schemes.

According to the Director Plantation Development Project Rs. 1.190 million has been already disbursed and the balance amount of the approved loans will be disbursed during the year. Menawhile, another Rs. 275.4 million has been invested on worker amenities and Rs. 8,86 million on social awareness programmes.

The PDP funded by the Asian Development Bank and the Japan Bank for International Cooperation is implemented under the Ministry of Plantation Industries and it supports identified activities in 471 estates managed by the privatized regional plantation companies and government owned corporations and boards spread out in 14 districts.

Plantation stocks

With reference to the weekly surveillance of the 18 plantation stocks, 11 were lower in value whilst four reported a gain and three reported static. Tea Smallholders showed a gain of 11 percent, week-on-week.

Make NCASL membership mandatory

Ramani KANGARAARACHCHI

The Government must make the National Chamber of Construction Sri Lanka (NCASL) membership a mandatory requirement in all Government contracts to ensure that the employer get the best services and to develop the contractor.

Chairman, NCASL, Rohan Karunaratne said the NCASL will be able to help the Government by providing the background and the capacity of the contractors.

He requested ICTAD also to obtain this membership.

Karunaratne said the Gross Domestic Capital Formation (GDCF) was about Rs. 9,000 million last year and 61 per cent of that has been contributed by the construction industry.

He pointed out that out of that, 81 per cent has been contributed by the private sector which is the engine of growth.

Karunaratne hoped that ‘Construct’ exhibition organised by the NCASL will be one of the three best exhibitions in the region in the near future as there are fresh winds blowing across Construct 2008, which has given a new dimension. The theme of the exhibition this year was “Opening up Sri Lanka’s construction future.”

A three year plan with the vision of broad basing the NCASL activities will be implemented shortly, he said.