TEA

John Keells Tea Report:

UK, Japan, Continental buyers active

Sri Lankan Tea Sale Averages for the month of February which has just been released, shows positive variances for the month as well as todate compared to the corresponding period of 2010.

The total National Average for February 2011 at Rs 393.67 is Rs 13.31 above 2010, and Rs 8.93 to date.

Significant gains have been recorded from High Grown (4.94 percent) followed by (3.50 percent) from the Low Growns.

Medium Grown on the other hand has recorded a marginal increase of 1.24 percent for February.

As expected January Tea Crop of 20.6 Mkgs recorded a 23 percent drop compared to the 26.8 Mkgs the previous year. February Crop too is likely to fall short of last year due to the inclement weather experienced during the month.

The 0.9 mkgs. of Ex Estate teas on offer met with lower demand with fair weight remaining unsold.

A few improved select Best BOPs sold well appreciating in value, whilst the others were barely steady.

BOPFs too which were Rs 5 to Rs 10 easier at the commencement declined further as the sale progressed with a number of invoices being difficult of sale.

The few Nuwara Eliya invoices of BOP and BOPFs appreciated by Rs 10 to Rs 15. Uva BOPs were irregularly dearer following quality, whilst BOPFs were lower. Except for a few Select Best Low Grown CTC PF1s that were mostly firm, others along with the Below Best declined Rs 15 to Rs 20 and more. High and Medium PF1s were lower, but to a lesser extent.

The tea bag sector was somewhat selective whilst Russia was mostly quiet. UK, Japan and Continental buyers were active following quality.

The 3.2 mkgs of Low Growns that were on offer this week, met with good demand but at lower levels. The turmoil in the Middle East had an impact at the Colombo Auctions this week with most overseas buyers requesting to go slow with the shipments and also with the impending Iranian New Year, activities in this market too slows down. Unless the unrest settles down soon, we could see a further decline in prices.

The weather continues to be very dry with very hot days which has brought about a reduction in crop intakes.

Western Teas

A few Select Best BOPs sold well on special inquiry, other good invoices were barely steady, Below Best and plainer sorts advanced Rs 5 but eased as the sale progressed.

Select Best BOPFs advanced Rs 10 to Rs 15 following special inquiry, other good invoices declined Rs 10, Below Best sorts shed Rs 5 to Rs 10 as the sale progressed, plainer varieties were firm to easier. Medium BOPs declined Rs 5 to Rs 10, whilst BOPFs eased Rs 10 to Rs 15 on average.

Nuwara Eliya Teas

Brighter BOPs advanced Rs .10, whilst others gained Rs 15 to Rs 20. BOPFs advanced Rs 10 to Rs 15 on average.

Uva Teas

BOPs advanced Rs 5 to Rs 10, whilst BOPFs declined by a similar margin. Uda Pussellawa BOPs advanced Rs 10 to Rs 15, whilst BOPFs shed Rs 5 to Rs 10.

CTC Teas

A few Select Best Low Grown PF1s were firm, others were Rs 15 to Rs 25 lower. BP1s were firm to irregular.

High and Medium PF1/BP1s declined Rs 5 to Rs 10 as the sale progressed.

Low Growns

Lower demand. Select Best OP1s eased Rs 10 to Rs 20, Best types maintained last levels, Below Best and poor sorts declined Rs 5 to Rs 10. Select Best and Best BOP1s shed Rs 10 to Rs 20, Below Best and poor sorts were irregularly lower by Rs 5 to Rs 10. Select Best along with the Best OPs eased Rs 10 on average, Below Best and poor sorts too were lower by a similar margin.

Select Best OPAs declined Rs 10 to Rs 20 and more following quality, the balance eased Rs 5 to Rs 10.

Select Best Pekoes were lower by Rs.30/- to Rs 50, Best and Below Best types tended lower by Rs 10 to Rs 15, flaky types too were lower by Rs 5 to Rs 10. Shotty Pekoe1s were firm to Rs 5 to Rs 10 dearer at times, Below Best and poor sorts eased Rs 5 to Rs 10.

Select Best and Best BOP/SP eased Rs 5 to Rs 10, Below Best and poorer sorts too declined by a similar margin.

Select Best and Best FBOPs shed Rs 5 to Rs 10, Below Best and poorer sorts were lower by a similar margin.

Select Best and Best FBOPF1s were lower by Rs 10 per kg, Below Best and poorer sorts were lower by Rs 5 to Rs 10. Select Best and Best Tippy varieties declined substantially on last levels, Below Best and poorer sorts too were lower to last.

Off Grades

Select Best and Best liquoring Fngs1s depreciated Rs 10, Below Best and poorer sorts eased by Rs 10 to Rs 15. Select Best and Best BMs were firm to dearer by Rs 10, Below Best and poorer sorts appreciated Rs 10 to Rs 15.

All BPs appreciated Rs 10. All Low Grown Fngs were dearer by Rs 15 to Rs 20 Select Best BOP1As were to dearer by Rs 5 to Rs 10, Best and Below Best too were firm to dearer by Rs 5 on average, poorer sorts were firm on last levels.

Dust

Select Best Dust1s were firm, whilst balance along with the poorer sorts declined Rs 20 to Rs 25. Clean secondaries shed Rs 15 to Rs 20, whilst the Below Best types declined further, poorer sorts were firm. Best Low Grown Dust/Dust1s declined Rs 5, whilst the balance gained Rs 10 to Rs 15.

Global tea industry:

Bogawantalawa Tea setting standards

Bogawantalawa Tea Estates PLC (BTE PLC) has reaffirmed to be the leader in a closely competed global industry by obtaining a series of international social accountability certificates for industry best practices.

The acquisition of Social Accountability 8000 Certificate made BTE the only company in Sri Lanka to receive an international certification of the highest calibre in recognition of its compliance with the United Nations’ universal declaration on human rights. SA 8000 also complies with the prerequisites of the ILO, encapsulating elements such as freedom of association, non-discrimination, wage and benefits, fair working hours and health and safety.

BTE is among four tea companies in the world; one being Tata teas and two other Kenyan companies, who has achieved this prestigious social accountability certification so far.

BTE Director and Chief Executive Officer Sarath Fernando said, “BTE has established a strong business connectivity with the employees and trade unions by empowering them, adopting transparent management systems, encouraging teamwork and establishing business integrity. Stemming from a strong belief that we need to safeguard the hands that serve us and the land that feeds us, BTE has taken necessary steps to align our business practices with global social accountability standards and constantly and continuously work towards achieving these requirements.”

BTE has also obtained Fair-Trade Multi Estate Certificate (from FLO) for seven of its estates and factories for complying with and maintaining consistent social, economic and environmental parameters across board. The benefits of FLO certification is diligently passed-on to the true custodians of the certification, the employees, in the form of activities pertaining to socio-economic value addition and environmental conservation.

BTE is also the recipient of Ethical Tea Partnership (ETP) certification, which is obtained through an alliance of tea packers who are working together to improve the sustainability of the global tea industry. The ETP members share a vision of a thriving industry that is socially just and environmentally sustainable. Fernando said that BTE was the only tea brand in the world that was selected to present its finest brew to the special invitees of the Nobel Cap Party that followed the Nobel Prize awards 2010.

BTE emerged the runner-up of the National Business Excellence Awards 2010 for its business and financial performance, global reach, knowledge and technology integration, capacity building among employees, corporate governance and corporate social responsibility. With the right employees trained for right skills and competencies and with right processes and certifications in place BTE has become the no one supplier of pure ceylon tea to the US market, the no. a own-brand tea supplier to the Japanese market and the largest supplier of private label teas to the Dutch market.