MARKETS
John Keells Tea Market Report:
Record tea crop in March
Brighter Nuwara Eliya BOP/BOPFs
although lower to previous week is well above
an average Western BOP/BOPFs selling
above Rs 400. The plainer Nuwara Eliya's however were of a much weaker
market.
The Sri Lanka tea crop for March at 33.3 Mkgs. is the highest on
record surpassing the previous best of 32.4 Mkgs. in 2008. High and
Medium elevations have recorded increases of 80 percent and 72 percent
respectively compared to the corresponding months of 2010 with Low
Growns recording a 50 percent increase. The phenomenal crop increases in
March has helped, recoup the crop deficit of 9.3 Mkgs, as at end
February in addition to registering a 2.9 Mkgs. surplus to end March.
The main contributory factor for the High crop intakes from the High and
Medium elevations in March was on account of useful and frequent rains
experienced in the first quarter of the year which is a period normally
associated with dry weather. With such high crops presently being
experienced it is unlikely that we would see a rush in the months of
April, May.
In
view of high crops in March the weekly auction quantities in April
continued to rise with the Ex Estate sale of May 11, exceeding the 1.8
Mkgs. The large crops coupled with a drop in product quality have taken
a toll on prices at last week's Ex Estate sale comprising of 1.6 Mkgs.
Both Western High Grown BOP/BOPFs met with lower demand with prices
declining Rs 20 to 30 on average. Brighter Nuwara Eliya BOP/BOPFs
although lower to previous week is well above an average Western BOP/BOPFs
selling above Rs 400. The plainer Nuwara Eliya's however were of a much
weaker market. Uva's too were much lower declining Rs 20 to Rs 30 with a
fair weight remaining unsold. Best CTC PF1s were firm to a little
irregular, whilst others tended lower. High and Medium types too were Rs
15 to Rs 20 easier.
A large volume of 3.8 Mkgs. of Low Growns came under the hammer last
week was the largest quantity on offer for 2011. There was widespread
demand, however at lower levels. Hence prices declined Rs 5 to Rs 10
particularly for Pekoes and OPAs. Most BOP1s too declined at times
fairly sharply. In the Small Leaf category the BOP SP continued to sell
well, however the Below Best FBOPs and FBOPF1s and most Tippy varieties
declined in value.
There was excellent demand from Russia, whilst Iran, Iraq, Libya,
Syria and Saudi Arabia lent useful support.
Western Teas
Select Best BOPs declined Rs 20 to Rs 30, other good invoices shed Rs
10 to Rs 15, Below Best sorts eased Rs 10 to Rs 15 and more at times,
plainer varieties shed Rs 10 to Rs 15 on average. Select Best BOPFs shed
Rs 15 to Rs 20 on average, other good invoices declined Rs 10 to Rs 15
and more, Below Best sorts shed Rs 15 to Rs 20 and more as the sale
progressed, plainer varieties eased Rs 15 to Rs 20 on average. Medium
BOP/BOPFs declined Rs 20 to Rs 30 on average.
Nuwara Eliya Teas
Brighter BOPs declined Rs 20 to Rs 30, others were substantially
lower. A few bright BOPFs sold well on special inquiry, most others
declined substantially.
Uva Teas
BOPs declined Rs 15 to Rs 20 and more at times. BOPFs shed Rs 20 to
Rs 30 on average. Udapussellawa BOPs eased Rs 20 to Rs 30 and more for
the poor leaf sorts. BOPFs shed Rs 30 to Rs 40 on average.
CTC Teas
Select Best Low Grown PF1s were firm to marginally easier, others
declined Rs 20. BP1s shed Rs 20 on average. High and Medium PF1s
declined Rs 20 to Rs 25. BP1s eased Rs 10 to Rs 20 on average.
Low Growns
Fair demand. Select Best OP1s maintained last levels, selected clean
invoices appreciated Rs 5 to Rs 10, Below Best and poor sorts were
irregularly lower by Rs 5 to Rs 10 Select Best BOP1s shed Rs 20 to Rs
40, Best types were steady, Below Best and poor sorts were lower by
Rs.5/- to Rs 10. Select Best OPs gained Rs 5 to Rs 10, however the Best
and Below Best types declined Rs 5 to Rs 10 poor sorts declined Rs 10 to
Rs 15. Select Best OPAs appreciated Rs 5 to Rs 10, Best types were
mainly firm, Below Best and poor sorts were irregularly lower by Rs 5 to
Rs 10. Select Best Pekoes appreciated Rs 10 to Rs 20 however the balance
tended lower by Rs 5 to Rs 10. Shotty Pekoe1s eased Rs 10 on average,
Best types too were lower by Rs 10 to Rs 15, Below Best and poor sorts
were irregularly lower by Rs 5 to Rs 10. Select Best and Best BOP/BOP.SPs
maintained last levels, Below Best and poorer sorts eased Rs 5 to Rs 10.
A few well made wiry FBOPs advanced Rs 10 to Rs 15 and at times more,
however the others remained firm. Best FBOPs gained Rs 5 to Rs 10, Below
Best and poorer sorts met with irregular demand and were mostly lower by
Rs 5 to Rs 10. Select Best FF1s maintained last levels, Below Best types
eased Rs 5 to Rs 8, poorer sorts declined Rs 5 to Rs 10. Select Best
tippy varieties met with good demand and advanced a few rupees above
last, Below Best and Best types met with irregular demand, poorer sorts
shed Rs 10 to Rs 20.
Off Grades
Select Best liquoring Fngs1s were lower by Rs 10 to Rs 15, while
Below Best and poorer sorts depreciated by Rs 20 and more at times.
Select Best and Best BMs depreciated Rs 5, while poorer sorts were lower
by Rs 10 from last levels.
All BPs depreciated Rs 10 and more at times. All Low Grown Fngs
depreciated Rs 10 to Rs 15. Select Best BOP1As along with the Best
declined Rs 10 to Rs 15, Below Best too eased by similar margin, poorer
sorts too were firm to lower by Rs. 10/- to Rs.20/-
Dust
Select Best Dust1s declined Rs 10 to Rs 15, while the Best Dust1s
declined Rs 20 to Rs 30, Below Best types too declined Rs 30 to Rs 35,
while the poorer sorts declined further. Clean secondaries shed Rs.25/-
to Rs 30, while the balance declined further. Best Low Grown Dust /
Dust1s eased Rs 20 to Rs 30, while the balance declined further.
Weak market sentiments
Weak market sentiments were prevalent in the Colombo Stock Exchange
during the last week with little buying pressure building on indices.
Benchmark ASI dropped notably by 99.85 points WoW (-1.33 percent) to
close at 7,356.97 and more sensitive MPI witnessed loss of 124.34 points
WoW (-1.79 percent) to end the last week at 6,822.77. Average daily
turnover of the last week stood at Rs.1.7 billion (-4.82 percent WoW)
Foreign participation was slightly increased to 18.57 percent of the
overall market activity and at the end of the week foreign selling
outweighed foreign buying by Rs. 721.4 million.
The
Colombo Stock Exchange continued its downtrend with the start of the
week on Monday for the fifth consecutive day and ended in the negative
territory with a massive setback as selling pressure intensified during
trading hours. Both ASI and MPI closed at 7,345.48 and 6,855.27 with
heavy losses of 111.34 points (-1.49 percent) and 91.84 points (-1.32
percent) respectively.
Central Finance Company Plc (Rs.252.7 million), John Keells Holdings
Plc (Rs.106.5 million) and Lankem Development Plc (Rs.65.7 million) made
strong contributions to the daily turnover while counters such as Free
Lanka Capital Holdings Plc and Pelawatte Sugar Industries Plc were
actively traded during the day.
Trades at the Colombo Stock Exchange were passive on Tuesday as both
indices varied around the previous day's levels. ASI closed at 7,349.17,
up marginally by 3.69 points (+0.05 percent) while MPI lost 18.73 points
(-0.27 percent) to close at 6,836.54.
Commercial Bank Plc (Rs.387.5 million) turned out to be the top
contributor to the turnover with several off-the-floor deals. In
addition noteworthy contributions to the turnover were seen from
National Lanka Finance Plc (Rs.94.4 million) and Central Finance Company
Plc (Rs.49.9 million). Meanwhile counters such as Free Lanka Capital
Holdings Plc, People's Leasing Finance Plc and Union Bank Plc were
traded heavily.
On Wednesday the Stock Market bounced back to green though gains were
modest to make note of. ASI was up by 14.61 points (+0.20 percent) and
closed at 7,363.78 while MPI recorded a loss of 20.17 points (-0.30
percent) to close at 6,816.37. Lankem Ceylon Plc (Rs. 185.7 million),
Brown and Company Plc (Rs.108.5 million) and Colombo Fort Land and
Building Company Plc (Rs.72.7 million) were the main contributors to the
turnover. These counters were also traded intensely to attract active
level of investor participation.
Positive gains in the market were carried forward to Thursday.
However the gains were meager to record a significant impact on indices.
ASI gained 13.87 points (+0.19 percent) to close the day at 7,377.65 and
liquid MPI increased by 19.96 points (+0.29 percent) to close at
6,836.33. Larger contributions were made to daily turnover by stocks
such as Commercial Bank Plc (Rs.265.5 million), Colombo Fort Land and
Building Plc (Rs. 218.1 million) and Pan Asia Bank (Rs.193.4 million).
In addition high investor participation was seen in Free Lanka Capital
Holdings Plc, Brown and Company Plc and Lankem Ceylon Plc.
The market wrapped its weekly operations on Friday, demonstrating
high level of intra-day volatility. Albeit encouraging gains in the
morning session, the market lost its steam in the afternoon to end in
the red zone. ASI weakened by 20.68 points (- 0.28 percent) to end
trading for the week at 7,356.97 and more sensitive MPI dropped by 13.56
points (-0.20 percent) to close at 6,822.77. Commercial Bank Plc
(Rs.704.2 million) sustained its position at top as the top contributor
to the turnover followed by Colombo Dockyard Plc (Rs.119.9 million) and
Colombo Fort Land and Building Plc (Rs.89.1 million). In the meantime
Pan Asia Bank Plc, Tess Agro Plc and Union Bank Plc were aggressively
traded during the day.
The information contained in this report, researched and compiled for
purposes of information do not purport to be complete description of the
subject matter referred to herein. In preparing this report care has
been exercised to collect information from sources which we believe to
be reliable although we do not guarantee the accuracy and completeness
thereof. Lanka Securities (Pvt) Ltd. and/or its affiliates and/or its
directors, officers and employees shall not in any way be responsible or
liable for loss or damage which any person or party may sustain or incur
by relying on the contents of this report and acting directly or
indirectly in any manner.
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