Tea prices expected to grow

Weekly tea prices are slowly edging up, with this weeks auction pushing the monthly average to Rs. 188.43, up from Rs. 181.24 in late August. The annual average however is only some 45 cents higher from late August at Rs. 180.45.

Industry watchers say prices will improve further in the coming weeks, especially with the winter season beginning.

Tea prices took a beating during the second quarter of the year, when the April and May holiday backlog of teas hit the market.

Though not unusual and an annual occurrence, the increased output after the 2005 holiday season continued an average of around 7.5 million kilos a week, up from an average 6 million kilos a week in 2004.

Adding further price pressure was the sustained high tea supply up to July 2005, against a late May early June end for the backlog of teas.

Industry watchers say output levels, though declining slowly, are still high, with upcoming auction quantities also higher than 2004 levels.

Gross Sale
Averages –

September 6-7 Auction
 


Week

Todate

 (Rs/Kg)


2005


2004


2005


2004

Uva High

168.03

183.70

149.28

148.35

Western High

178.09

187.45

168.59

171.96

High Grown
(Summary)


175.30


186.54


162.11


163.43

Uva Medium Grown

165.53

179.51

158.96

150.17

Western Medium
Grown)

152.90

162.53

152.21

142.70

Medium Grown
(Summary)


158.03


168.01


155.11


146.14

Low Grown


199.19


201.12


194.34


176.76

TOTAL


188.43


194.17


180.45


168.92

 Source
: Asia Siyaka Commodity Brokers

 

-Shafraz Farook: shafraz@vanguardlk.com