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Prices for tea are on the rise due to the lack of supply whilst the Colombo auctions are back on schedule thanks to the electronic platform clearing the backlog caused by disruptions on account of COVID-19 mitigation measures in the country since March.
Last week Sale No. 16 was concluded with 4.5 million kilos on offer and with the completion of the Sale, the Colombo Tea Auctions have returned to its usual schedule, Forbes and Walker Tea Brokers said. “There was good demand for most varieties of teas on offer,” it added.
The Ex-Estate offerings comprised of 0.65 million kilos and quality was reasonably maintained.
“Strong demand continued for the BOPF grade, particularly from the Western Planting Districts, whilst the brokers were irregular and tended easier,” Forbes and Walker said.
Most Low Growns continued to sell well. Off Grades – liquoring varieties were easier, whilst the Low Grown types continued strong. Improved demand for Dust varieties and records a Rs. 10-20 per kilo gain all round, it added.
Forbes and Walker said quantities of tea sold during 2020 have declined 15% vis-à-vis the corresponding period in 2019.
In comparing auction prices to date in 2020, shows a marginal gain in rupee terms, whilst in dollar terms hardly shows any change.
“However, over the past three to four weeks, tea prices have shown a significant increase,” it revealed.
In comparing prices realised at the last Auction (Sale No. 15) vis-à-vis the corresponding sale in 2019, rupee auction prices have shown a gain of 20%-25% and to a lesser extent in dollar terms. Interestingly, however, corresponding sale averages of 2018 in dollar terms still remains higher.
“Notwithstanding the ripple effects of COVID-19 on most economies, this augurs well for the demand of tea in the backdrop of a shortfall in production,” Forbes and Walker Tea Brokers added.
