A storm is brewing in the tea cup. Your cup of tea has become more expensive. In the last one month, packaged tea prices have witnessed an unprecedented rise. «Last month, we announced Rs 12 increase per kg for various categories of tea and are forced to announce another hike of Rs 12 per kg.
Never before have the tea prices jumped so fast,» said Parag Desai, executive director, Gujarat Tea Processors & Packers, which sells tea under the Wagh Bakri brand name. Desai said that the tea prices at the auction are touching the roof due to which companies are forced to announce the raise. Good premium tea prices have now jumped from Rs 292 per kg to Rs 316.
India’s annual tea consumption is currently around 800 mn kg and production last year was close to 980 mn kg. The country exported close to 180 mn kg of tea last year.
«Tea consumption is increasing at the rate of 5 per cent whereas production by 2 per cent. Tea garden owners are leveraging the demand-supply gap and for end users tea is becoming dearer,» said Piyush Desai, chairman and managing director, Gujarat Tea Processors & Packers.
Desai said that until and unless government breaks the monopoly of Indian tea garden owners by relaxing import duties, tea prices will continue to inch further. Currently, import of tea attracts a 100 per cent duty. Tea production in India has declined by 13 per cent to 82.29 million kg in the first quarter this year.
«Erratic rainfall and changing weather conditions might bring a further dip. Only way to ease out the burden on consumers is lower import duties as the tea is available in Kenya and other African countries at cheaper rates,» added Desai.
Tea packers said that they have made recommendations to Union commerce ministry to lower the import duty.
Source: timesofindia.indiatimes.com/city/ahmedabad/Tea-prices-soar-production-dips/articleshow/13367894.cms
Tea prices soar, production dips
