Black Day For Tea Auctioneers

It was a black day for tea auctioneers at Coonoor and Coimbatore on Friday. While 70% of the quantity on offer was left unsold at the weekly tea auction at Coonoor, the Coimbatore centre saw a sudden drop in prices with tea selling at Rs 10 to Rs 14 per kg less than the previous week. The global meltdown, cash crunch in Pakistan and Diwali season are said to be the major reasons for the sudden slowdown in tea market. Industry sources said, “Pakistan buyers are not able to get LC and banks are not in a position to make payment. The shipments to Pakistan have come to a standstill and payments are still to be made for the last one month.”

A leading auctioneer said the financial crisis in Russia has curtailed 20% of tea sales and the sales internally has also gone down because of the prevailing holiday mood. At Coonoor auction, only the good medium teas in both the leaf and dust varieties were sold. The prices hovered around Rs 75 to Rs 80 per kg, which were on an average lower by Rs 5 to Rs 10 per kg compared to the previous week. The tea prices dropped further at the Coimbatore auction centre and a kg of medium quality tea was selling at Rs 72 and even less.

The prices were nearly Rs 10 to Rs 14 per kg less than previous week. But the demand was quite normal in Coimbatore since the last week’s auction was cancelled due to Diwali. But in Coonoor, where an auction took place last week despite Diwali, the lowering of prices didn’t effect in any substantial purchase. “Only around 20% to 30% of the total quantity of teas on offer was sold,” said industry sources. “The situation is really panicky. We are afraid that the prices will further drop due to piling up of teas for next week sales,” a leading auctioneer said. Tea Trade Association secretary S Sreekumar added the situation is grim all over the country.

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