India News | Despite Record Prices, Old Problems Continue to Plague Assam Tea

Guwahati, Dec 26 (PTI) Despite some of Assam's prized tea crop fetching record prices at auctions, tea plantations continued to be plagued by old problems of low average prices, rising production costs and unpredictable rainr gods playing truant when needed.

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Two years of lockdowns and restrictions due to the COVID-19 pandemic have compounded the woes facing tea industry, though the new focus on producing quality tea by many gardens promises to help fetch better prices in the years ahead.

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The production of tea in the state till October this year has been higher compared to the corresponding period in 2020, according to Tea Board India data. However tea growers said this has simply meant that unsold stocks with them have increased as sales growth have remained muted.

From January to October 2021, tea production in Assam stood at 580.57 Million kgs, against 514.29 M. kgs during the same period in 2020.

While a kilogram of tea grown at the Manohari tea garden sold at a record price of Rs 99,999, earlier this month sold, the highest in any tea auction in the country, the overall price realisation hasn't been much to write home about.

Rajan Lohia, proprietor of Manohari Tea Estate said, “Overall, it was not a good year due to various factors. Low rainfall impacted production. Then, prices of the tea sold were not very high.”

“But we have seen a good sign also this year. There was significant difference between prices fetched by quality and non-quality teas,” he told PTI.

“The message was clear, focus should be on quality and not quantity. A time will come when only quality will matter,” Lohia added.

Rakhi Dutta Saikia of Pabhojan Tea Estate told PTI, “As a result of the outbreak of pandemic last year, tea stocks remained unsold in many gardens and companies. This year's crop has only increased the stock in many cases as sales have not been any higher compared to other years.”

The decrease in exports due to the pandemic has also hit gardens like Saikia's Pabhojan which produce specialty tea that has a bigger market abroad compared to the domestic demand.

“There has been a dip in exports since last year. The manufacturing costs have only gone up without commensurate rise in auction prices,” Saikia added.

India has exported 137.97 M. kgs of tea between January to September this year, with the figure for the same period in 2020 being 153.27 M. kgs, according to Tea Board India data.

Saikia said stand-alone tea estates are consequently looking to diversify to better their profitability.

“We have started offering tea tourism packages in our estate. We have to look to supplement our income from selling tea,” she said.

North Eastern Tea Association (NETA) chairman Sunil Jallan during the association's biennial general meeting last month also underlined the stress faced by tea exporters.

He also underlined the need to use Bangladesh's waterways for export of tea from the region and pointed out that currently the waterways and ports (Chittagong, Mongla, etc.) of Bangladesh can only be used for re-entry into India and not for exporting goods to other countries.

Since supply outstripped demand for tea, Tea Association of India (TAI) president Ajay Jalan has asked the Union Industry and Commerce Minister Piyush Goyal to work to promote tea consumptions, pointing out that an increase of even by 100 gram per capita consumption in the country would lead to consumption of another 131 million kg annually.

At present, per capita consumption of tea in India stands at 830 grams per head/year as compared to 1.61 kg per head in UK and 1.01 kg per head per year in Pakistan.

“We have to regulate supply and create demand for tea,” Jalan said.

Tea growers are also working on this from the supply end. Talking to PTI, Dr Pradip Baruah, chief advisory officer of the Tocklai Tea Research Institute, said, “growers are now focussing on quality of the tea produced. Quantity was never a problem, ensuring good quality was and is the main issue.”

“Many growers are realising that if they produce good quality tea, even if the quantity is less, they will earn better prices,” he said.

Baruah said this focus on quality will spell better overall price for Assam tea and inspire all growers to concentrate on the quality and not merely quantity.

Rajan Lohia of Manohari Tea Estate, summing up the growing thrust on quality, added, “Price realisation is good when the quality is good. Our growers are understanding it and working towards it.”

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)