Small Growers Licensed to Build Factory


India has for the first time licensed an organization of small growers to build and operate a tea processing factory as a means of improving profitability and innovation.

KOFEUCHA is a 300 member “self-help” alliance similar to a grower co-operative but less formal. It is named for the three villages in Assam where members have their gardens. The villages are Kohargaon, Fetanigarh and Udaipur – KOFEU with the word cha (tea) appended.

It is the largest and oldest of 200 SHG (self-help groups) in Assam, the world’s largest tea producing region.

The Tea Board of India is eager to reduce constraints on small holders who typically sell their leaves to bought leaf factories that emphasize quantity over quality and prevent individual growers from establishing a brand or reputation for the teas they produce. Small holders have long complained that bought leaf factory owners pay little for their effort. Factory owners point out that much of the small holder tea that arrives is low quality and in small lots.

Granting a license to build the factory in the Tingkhong area of Dibrugarh district and providing a subsidy of 40 percent of construction costs for the $535,000 facility gives KOFEUCHA an opportunity to determine a fair price for members and potentially establish a brand. The plant is designed to process 15,000 kg per day. Capacity will top 2.5 million kilos annually, making it competitive with commercial factories in the region.

India Tea Board Chairman M.G.V.K. Bhanu told The Telegraph over phone from Calcutta that the board has been encouraging small tea growers in Assam to form self-help groups and set up factories of their own.

“KOFEUCHA will be the first self-help group in Assam to be issued a license for the factory. We have also asked other SHGs to apply for licenses to set up factories and if these groups fulfill the necessary criteria we will definitely issue licenses to them, too,” Bhanu told the newspaper.

The general secretary of the All-Assam Small Tea Growers Association, Karuna Mahanta, said the Tea Board’s assurance of issuing the license is a welcome step and will help small tea growers to be independent.

“We no longer have to depend on bought leaf factories and other factories of big tea gardens to sell our leaf and about getting low prices. We can now concentrate on producing quality tea and come up with our own brand,” he said.

Together the 72,000 small tea holders registered account for nearly 30 per cent of the state’s tea production of nearly 500 million kg.

Source: The Telegraph(Calcutta)

Dan Bolton

About Dan Bolton

Dan Bolton edits STiR Tea & Coffee Industry International. He was formerly editor and publisher of World Tea News and former editor and publisher of Tea Magazine and former editor-in-chief of Specialty Coffee Retailer. He is a beverage retail consultant and frequent speaker at industry seminars and conferences. His work has appeared in many beverage publications. He was a newspaper reporter and editor for 20 years prior to his career in magazines. Dan is the founding editor of Natural Food magazine and has led six publishing ventures since 1995. He lives in Winnipeg, Canada.