Nov 14, 2008 (LBO) – Sri Lanka’s tea market is continuing its recovery with demand picking up at this week’s auction, brokers said. Prices of low grown teas, the hardest hit when demand and prices collapsed last month causing severe cash flow problems for the trade, improved at this week’s sale.
“Demand for low grown teas started picking up at the last auction in October and continued to the auction concluded last week,” brokers Asia Siyaka Commodities said in a report.
It said that at the October 29, 2008 sale the Tea Board intervened and bought stocks but that at the sale of November 5 the market held and some grades strengthened without Tea Board intervention.
“This week saw more demand overall with Pekoes gaining one dollar per kilo by the close,” Asia Siyaka said.
“Opening of trade routes closed for almost a month and gradual re-entry of regular markets has helped revive the market.”
Forbes & Walker Tea Brokers said in a report that this week a relatively smaller quantity of 5.9 million kilos came under the hammer.
“There was better demand this week for most low grown grades,” it said.