Tea prices, production costs affecting industry
A persistent gap between tea prices and the cost of production is affecting the viability of the industry, said Ashok Kumar Bhargava , Chairman Indian Tea Association.
Tea prices for the last 10 years have risen by around six per cent, while input costs have risen by over 10 per cent. “Even high-quality teas are selling at lower prices now” he told reporters. Mr. Bhargave advocated adoption of the ‘Trustea’ certification for improving tea prices.
Lower demand for better teas has also eroded the margins of companies in West Bengal and Assam, Mr. Bhargava said. ITA vice chairman Azam Monem said that lower prices for quality teas was an aberration, but it could become “disturbing” if it became a trend.
He said that while domestic per capita tea consumption was low in India exports were stagnating in the wake of excess supplies of teas from Kenya (to the tune of 70 million kgs).
The tea industry has identified the 15-24 year age group for driving its domestic consumption through projection of tea as a “cool wellness beverage.” Arijit Raha ITA Secretary General said that events were now being held to promote tea.
The industry is also seeking the support of the Tea Board of India and the state governments (through promotional funding) for promoting the Tea Board’s ‘Trustea’ certification which Mr Bhargava felt could be adopted as a vehicle to establish a trusted supply chain –from the tea bush to the cup.
A sustainable production paradigm for any product encompasses conformity and compliance with norms governing preservation and protection of the environment, product traceability and safety and protection of human rights. ‘Trustea’ certification addresses these issues and was introduced in 2013 with support from Tea Board , the industry and two major tea buyers, among others.
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