Tea Production Rising

Tea Production

Kotagiri, India

Unpredictable weather conditions that swung from drought to downpour significantly depressed tea yields in several major regions, depleting reserves and firming pricing as consumption equaled or exceeded production.

That cycle appears to be easing in the early months of the 2013 harvest. The India Tea Board reports output up by 5.5 percent. Sri Lanka saw an 8.4 percent increase and Kenya, ravaged by drought, reported an increase to 38.5 million kilos in February from 18.4 million kilos the same month last year, according to the Kenya Tea Board.

The immediate impact is declining prices in the Mombasa Auction. In Kalkata auction, prices are holding firm at INRs 154 ($2.83 per kilo) for CTC grades. In February, tea production in the Assam Valley was 20 percent ahead of last year and the Darjeeling production was even with Karnataka showing a 25 percent increase.

Sources: Kenya Tea Board, India Tea Board