Sri Lankan tea prices up

April 30, 2009 (LBO) – Sri Lankan tea prices rose again at this week’s auction, propelled by the weakening rupee and strong demand from the Middle East, brokers said. “Teas in the higher priced bracket continued to decline further following quality whilst the neat leaf coloury teas showed a firming up of prices. Poor leaf teas tend to be neglected.” Prices of most low grown teas, which account for the bulk of the output, went up while most types of high grown teas weakened.

“The low grown market was substantially dearer this week with most varieties of tea recording price gains,” brokers Asia Siyaka Commodities said in a report.

In the Large Leaf catalogues, OP/OPA varieties were well sought after with prices shooting up 30 – 50 rupees a kilo.

In the Small Leaf catalogues FBOP/FBOPF1 varieties gained 20 to 30 rupees a kilo.

The rupee has fallen sharply against the dollar in recent weeks and is now trading around 121.

Exporters had been demanding a depreciation of the rupee to make their teas more competitive after the currencies of key buying nations and other tea exporters weakened.

At this week’s auction in Colombo, prices of teas from