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Tea market developments reported by brokers last week indicated that tea production was just slightly higher over the production reported during the same period in 2023. No explanations were forthcoming for the lacklustre performance. Besides, we were unable to obtain comment from the estate sector.
However, smallholders and tea factory owners when requested for comment said that low grown prices were quite within their profit margins. They also said that factories in Ratnapura and also those in some area s in the Galle district were paying bought suppliers around SLR. 300 per kilo for green leaf supplied.
Commenting on these prices they also cautioned that such prices for green leaf were not widespread but restricted to ‘some’ areas.
John Keels PLC commenting on prices realized on June 4 th and 5th 2024 said that low grown FBOPF (Flowery Broken Orange Pekoe Fannings) realized prices between Rs. 6000 and Rs. 6700 per kilo.
Asia Siyaka Weekly Tea Update reported that production in 2024 was 101.75 million kilograms. They also said 2023 production was 102.62 million kilograms over the same period. Overall 6.20 million kilograms of tea were on offer at last week’s tea auction. Of this quantity 2.76 million comprised low growns. 2.2 mnkgs were high grown and mid growns. We also received comment from Forbes Walker Tea Brokers who said that ex- estate prices improved market activity.
They also commented that prices were firm and augured well for the industry.
Although we were unable to seek comment from the formalized plantation sector we did consult large scale smallholders, who cautioned us that they should not be quoted, but said that in the hill country prices realized for main grades were quite good and that profits were substantial.
We sounded them on the wage increases and justification of the wage demand of Rs.1700. per worker per day. They said ‘mums -the-word’. “Sorry no comment”.
However, they said such demands were perennial and did surface over the years. Employers in the pre-nationalization era were also faced with these demands. They cited the Thondaman era when the plantation owners grumbled that the estate sector would not survive. Survive they did. And the industry did not close down.
Tea is a major income earner for the country.Garments and other industries demand recognition, but all -in –all tea is wholly home- grown and not dependent on imports for survival.
Source: https://island.lk/tea-production-leaving-much-to-be-desired/
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