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Monday, 22 November 2010

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TEA

John Keells Tea Market Report:

Weak market for liquoring teas

The inter monsoonal evening thunder storms that is the precursor to the North East monsoon usually commence in early October. This year, in September the tail end of the South West monsoon came in strong and October was relatively dry.

The convergence of winds has now commenced and Colombo received 440 mm of rain in 12 hours.

This was the highest in 18 years, and resulted in disruptions to the transportation system in the city. The Meteorological Dept forecasts that evening thunder storms will persist until the middle of December.

This would indicate a deviation from the usual weather pattern and could be as a result of Global warming. Hitherto, the monsoons have not been unduly delayed.

However, some changes are being witnessed and one such scenario is that Hydro Power Reservoirs filled up in September, including Kotmale and Victoria, which usually does well during the North and East monsoon.

Another is that in the past, the crop increased as the sun came out after rain.

In recent times, the intensity of the rains have curtailed crop whilst no sooner the sun comes out, the conditions appear very dry, thus limiting crop.

A close study is therefore needed to overcome these scenarios, as the cost of production remains high, for extended periods.

The market for liquoring teas was weaker last week, with the high priced teas falling the most. More buyers appeared to be active but at lower levels.

The Tea bag sector was active but Russian interest appeared less. Buying for Japan was evident.

Most of the fairly good western teas were selling around the Rs 400 level whilst the best sold between Rs 420 and Rs 450.

Low grown CTC teas continued to weaken in the wake of larger offerings, except for two of the most established marks which held a good premium over the others.

The 3.7 mkg of Low Growns that came under the hammer this week met with widespread demand but at lower levels. It appeared that there was less Russian interest. In the Leafy category. BOP1/OP1s continued to sell well, however at slightly lower levels. Demand for the Pekoe grade continued with the bulk of the offerings selling around Rs 390 - to Rs 420. OPAs too sold well, however once again at slightly lower levels to previous week.

In the Small leaf category the best FBOP/FF1s were barely steady but others declined as the sale progressed.

The poorest were difficult of sale.

There was less inquiry from Russia, however Iran, Iraq and Syria were quite strong. Libya, Dubai, Jordon, Saudi Arabia also lent useful support.

Western Teas

Select Best BOPs declined Rs 10 to Rs 15, other good invoices were firm to marginally easier, Below best sorts declined Rs 10 and more, plainer varieties were firm to Rs 5 easier.

Select Best BOPs declined Rs 15 - to Rs 20 other good invoices shed Rs 10, Below Best sorts declined Rs 10 - to Rs 15 on average, plainer varieties were Rs 10 easier.

Medium BOPs were firm. BOPFs shed Rs 5 to Rs 10.

Nuwara Eliya Teas

Brighter BOPs declined Rs 10, others declined substantially. BOPFs shed Rs 20 to Rs 30 on average.

Uva Teas

BOPs eased Rs 10 to Rs 15, whilst BOPFs were firm to Rs 5 easier. Udapussellawa BOPs declined Rs 15 to Rs 20 and more. BOPFs shed Rs 5 - to Rs 10 on average.

CTC Teas

Select Best PF1s declined Rs 15 to Rs 20, others shed Rs 30 and more with a large volume remaining unsold. BP1s declined Rs 15 to Rs 20. High & Medium PF1s declined Rs 5 to Rs 10. BP1s were firm to Rs 5 easier.

Low Growns

Fair demand. Select Best OP1s eased Rs 10 on average, balance too were lower by Rs 10 to Rs 15, Below Best and poor types were mainly neglected due to lack of sufficient bids.

Select Best BOP1s maintained last levels, however Best and Below Best types declined Rs 5 to Rs 10, poor sorts too were irregularly lower by a similar margin. Select Best OPs shed Rs 20 to Rs 30, the Best types too were lower by Rs 10 to Rs 15 and more at times, Below Best and poor sorts eased Rs 5 to Rs 10. Select Best OPAs were firm on last levels, however the Best types were irregularly lower by Rs 5 to Rs 10, Below Best types were steady, bold types tended lower by Rs 5 to Rs 10.

Select Best Pekoes tended lower, Best types declined Rs 10 to Rs 15, bold Pekoe varieties along with the flaky types too were irregularly lower by Rs 5 to Rs 10. Shotty Pekoe1s shed Rs 20 to Rs 40, Best types were lower by Rs 10 to Rs 20, Below Best and poor sorts were irregularly lower by Rs 5 to Rs 10 Select Best and Best BOP/BOPSP eased Rs 5 to Rs 10, Below Best types were firm, poorer types were irregularly lower to last.

Select Best FBOPs advanced Rs 10 per kg, Best and Below Best types eased Rs 5 to Rs 10, poorer sorts too declined Rs 5 to Rs 10. Select Best FBOPF1s were firm, however Best and Below Best types shed Rs 5 to Rs 10, poorer types too were lower by a similar margin.

Select Best and Best Tippy varieties declined substantially on last levels, Below Best types were barely steady, poorer sorts declined Rs 20.

Off Grades

Select Best liquoring Fngs1s appreciated Rs 10 to Rs 15, whilst the Best and the Below Best types were dearer by Rs 10, poorer sorts appreciated Rs 10 and more at times.

All BPs sold at firm levels. Select Best BMs were dearer by Rs 5 to Rs 10, Best and the Below Best types were irregularly dearer by Rs 5 poorer sorts eased by Rs 10 to Rs 15.

Select Best, Best and Below Best Low Grown Fngs were firm to dearer by Rs 10, whilst poorer sorts depreciated Rs 10 to Rs 15.

Select Best and Best BOP1As were firm to dearer by Rs 5 to Rs 10, Below Best however eased by an average of Rs 10, poorer sorts too declined by Rs 15 to Rs 25 and more at times with poor demand.

Dust

Select Best Dust1s declined Rs 10 to Rs 15, other Dust1s in the Best and Below Best category were firm following quality, whilst the balance declined Rs 10 to Rs 15.

Clean secondary Dust appreciated Rs 10 to Rs 15, whilst the balance were firm.

Best Low Grown Dust/Dust1s were firm, whilst the balance were Rs 10 to Rs 15 easier.


Tea promotion campaign


At the tea promotion campaign

Seven tea companies in Sri Lanka for the first time got together and organized a tea promotion campaign, along the Narahenpita road from Russels Tea Lounge to the junction.

Russels Chairman Russel Perera said this was organized to promote varieties of tea among the local people.

Russels (Pvt) Ltd launched this Tea Lounge and gallery on the September 25 with the collaboration of eight tea suppliers in Sri Lanka.

Akbar Brothers, Bogawanthalawa Tea Estates, Ranfer Teas, Imperial Teas, Amezon Trading, Empire Teas and Expo Lanka gave support during and after the launching of the lounge. It was their encouragement and support that made it a success, he said. Through this tea promotion we have made arrangements to give out few leaflets and samples to the public to taste, so they can have an understanding of what they will get at the lounge, Perera said.

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