Sri Lankan tea prices slump at Colombo auction

Oct 17, 2008 (LBO) – Sri Lankan tea prices fell on lower demand at the Colombo auctions this week, continuing a downward trend that mirrors the slump in global commodities, brokers said.

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The lower prices means lower earnings for the regional plantations companies listed on the Colombo bourse.

Auction average prices have fallen off their highs, and gone below last year’s prices but are still above those of 2006.

Prices of most varieties of tea fell at this week’s auctions while a few maintained last week’s levels.

Low grown teas, which account for more than half the crop, met with limited enquiry and a “significant volume” remained unsold, brokers Asia Siyaka Commodities said.

“A small selection of BOP1s sold around last levels, whilst most others were found difficult of sale,” they said in their weekly auction report.

“Better OP1s recorded substantial price declines whilst others remained unsold.”

Forbes and Walker Tea Brokers said total auction offerings increased to seven million kilos of which 1.4 million kilos comprised o