Sept 20, 2011 (LBO) – Sri Lankan tea crops and prices have fallen below those of last year imposing losses on plantations whose costs also went up with a recent wage hike, a broker has said. The ‘Uva’ quality season when teas grown on the eastern slopes of the island’s central hills yield their best quality and fetch high prices has also been disappointing, brokers John Keells said.
Colombo auction average tea prices are now below those of the same sales in 2010, they said in a report.
“Crops from the Western and Eastern sector are yet to show any significant signs of improvement and continues slightly below last year levels, and along with recent wage hike is keeping cost of production at its highest ever levels,” John Keells said.
“The last quarter of the year is normally associated with high crops, and producers will hope that things will turn around fast, as most of the plantations from these two sectors have suffered heavy financial losses in recent months, due to a combination of high production cost and depressed prices.”
The brokers also said that from the point of view of the world supply and demand, there is “no pointer” towards improved prices.