SUSTAINABILITY IN TEA INDUSTRY: An Indian Perspective

Ashim Kr. Das Introduction The tea Industry in India has a 170 years old history. The credit for creating Indias vast tea empire goes to the British !ho discovered tea in India. The "ast India #ompany after losing its monopoly in #hina in 1$%& has ta'en up cultivation of Tea in India (Assam) in 1$%*. The first commercial +atch of Tea ever produced outside of #hina came from Assam in 1$%,. -ince then tea continues to +e the most popular drin' in India. .rom official conferences to rail!ay station tea (chai) remains the favorite hot +everage among Indians (almost $/0 of the total households in the country consume a+out $10 of the total tea produced). This sector is critical to Indian economy. The Tea Industry is one of the oldest organi1ed firm sectors !ith a large net!or' of tea producers retailers distri+utors auctioneers e2porters and employees. India is one of the !orlds largest producer and consumer of tea (Ta+le 1 and &) !hich accounting for &7 percent of the !orld production and around 1&31% percent of the !orld tea e2port. Tea e2port from India estimated at 4s 17.%1 +illion during .5 &006 accounting for 0.* percent of countrys e2port in value terms tea ran's as the fourth7largest agro e2port item from India. The industry employs around 1.&7 million at the plantation !or' and & million people indirectly of !hich /0 percent are !omen !or'ers (second largest employer in the organi1ed sector after Indian 4ail!ay). In India there are a+out 1700 processing units engaged in tea production8 !hile around 1671 +ig (more then 100 hectares) planters !ith an output of 70077&/ m'g. The estimated 0.1*1 million small gro!ers have an annual output of only around &%7 m'g. Indias large tea plantations are mostly concentrated in Assam and 9orth7 Bengal. Assam alone produces /1 percent of the national production. Tea production in India during &007 declined +y 1.& percent to ,** m'g in comparison !ith an increase of 1.1 percent in &0068 +ut it is e2pected to increase to around ,60 m'g in &00$. Besides as an agro7+ased industry the development of plantation industry has contri+uted greatly to!ards rural development and ur+ani1ation of remote hilly areas +y optimum use of land opening up road and other communication net!or' in those areas. Recent developments Inspite of its importance tea industry of India is going through a crisis phase since 1,,0s. The industry has !itnessed many structural changes during recent years !hich include 3 emergence of small tea gro!ers in place of large plantation and introduction of +ought leaf factories (B:.). The 1

present crisis has led to the closure of many tea estates (e.g. &0 estates in Kerala %0 in ;est Bengal a+out 70 in Assam have close do!n since the late 1,,0s). It is estimated that more than 60 000 plantation !or'ers have lost their <o+s since &00& and livelihood of another tens of thousands are threatened. ;or'ers of the running estates are facing !age cut tougher pic'ing demand <o+ insecurity and the casualisation of !or' appalling living and !or'ing condition etc. In early &00/ the tea industry !itnessed ma<or companies !ithdra!ing from production and concentrating on the pac'aging= retailing sector (e.g. Tata. Tea >:: etc in India). They intend to focus on +rand +uilding +usiness and on e2ploring the mar'et su+stantially rather than on the plantation +usiness !hich is a lo! margin segment. The tea industry in this country has some inherent !ea'nesses3due to poor yield arising out of poor condition of the gardens ( more than %0 percent of the tea gro!n areas +eing a+ove the economic threshold age limit) defective auction mechanism old factory setup (!hich is affecting tea ?uality and price reali1ation) poor garden management fre?uent changes of garden management=managers in7e2perienced o!ners (li'e traders !ho have no previous e2perience in tea cultivation and interest in plantation +usiness) and the managements e2cessive reliance on +an'7 de+ts !ith negligi+le fresh e?uity infusion. In some of the gardens the neglect has +een due to o!nership disputes and diversion of funds from tea gardens to other activities and in many cases strained relationship +et!een management and garden !or'ers (I#4A study &007) have added fuel to the fire. In the mar'et the rising competition at domestic as !ell as international front has deepened the crisis of tea industry of India. The changing !orld order of last decade has left its o!n impact on the industry. The coming do!n of the Berlin !all and the disintegration of the former @--4 have led to many changes in industrys e2port mar'et. The first second and the third !orld are moving to!ards free glo+ali1ed economy !here free trade and free flo! of investment funds are the order of the day. #onsumers in the developed !orld are moving to!ards healthier products and ?uality assurance !hich put pressure on the e2port of tea from India. -hift in the composition of demand for tea in the importing countries has had unfavora+le effects on e2port earnings from tea in India. The international mar'et price of tea has declined from @- A &.0, to @- A &.0% per 'g in +et!een &00/ and &006. Though countries li'e -ri :an'a Kenya and Indonesia are gro!ing fast in their e2port and higher price reali1ation during the same period. "2port of tea from India to some of the ma<or importing countries li'e 4ussia @K and @-A are sho!ing a sharp decline. (Ta+le %).

&

Although per capita consumption of tea in India is amongst the lo!est (6* grams) +ut in volume terms India is the largest consumer. -ince 1,70 India has +ecome the largest a+solute consumer of tea after @K (Ta+le &). :arger domestic demand has given a ne! direction to the tea industry in the recent years. Major causes of the crisis Despite Indias historical success !ith the tea industry in recent years the industry has faced serious competition in the international and national mar'et !hich has lead to the present crisis. Bany factors have +een cited as causing the crisis in the Indian tea sector3since the late 1,,0s. Analysts agree that the dramatic fall in prices is one of the most significant causes of the crisis. The !orst affected are plantation !or'ers and small gro!ers8 many estates failed to !ithstand the do!n!ard slide of price and hence moved out of +usiness leading to the closure of tea estates that employ thousands of !or'ers and of factories (B:.) to !hich small gro!ers might sell their products. Tea prices in India are +eing driven do!n +y many factorsC a) Decline in demand for Indian tea in the glo+al mar'et +) Defects in auction system c) Door price reali1ation d) Defective mar'et structure e) Increase in cost of production a) Decline in demand for Indian tea in the global market The decade of ,0s has +een ?uite depressing for the Tea Industry in India (Asopa &007). The ma<or cause of depression in the industry !as the decline in the international demand of Indian tea. The traditional mar'ets of Indian tea li'e @--4 and @K have drastically reduced the import of tea from India. #hanged glo+al situations li'e disintegration of @--4 ;TE agreement glo+ali1ation of mar'ets across the nations etc. have proved to +e adverse to India. In the year &00* India lost its eminent position of the largest producer of tea to #hina. Kenya has already ta'en over -ri :an'a in e2port pushing India to third position (Ta+le %). There is a fierce competition a+road. Indian tea has lost its competitive advantage to other countries on account of high cost and poor ?uality. >o!ever one ne! development i.e. India +ecoming the largest consumer of tea ne2t to @K has provided a lifeline to the tea industry (Ta+le &). ;hile tea production of India gre! +y a+out &/0 percent since 1,*7 (1,*7 production7&//m'g and &007 production7,/0m'g) +ut the rate of gro!th of e2port remained insignificant (Ta+le71%). It appears that India gro! tea mainly for %

Indians. >o!ever the e2ports of all other leading tea e2porting countries have gro!n rapidly over the same period. The fact remains that !hatever the si1e of the domestic demand (par capita consumption !as &00grams in 1,/0 has increased to nearly 700grams in &007) there is still si1ea+le surplus amounting +et!een 1$0 and &00 million 'g that needs to +e sold (Asopa &007). (b) Defects in auction system Indias tea mar'et is facing yet another parado2 !hich could +e e2plained in terms of glaring gulf +et!een the price charged +y dealers and retailers (#houdhury &006). A &00/ report for the International :a+our Ergani1ation (I:E) notes that the large tea companies are +enefiting from fall in auction prices and rise in retail prices for tea. FThis !idening gap +et!een consumer and auction pricesGGis cutting into the margins reali1ed +y the tea producers +ut is not +eing passed on to the consumer in the form of lo!ered tea pricesH (Ioddard &00/). -imilarly a report +y the Iovernment of Assam pu+lished in &00* found it Funfathoma+le that the retail price of tea has not come do!n !ith the fall of auction price. #ertainly the margins of intermediaries are far too high. Drice paid to plantation and small tea gro!ers has fallen since 1,,$ retail prices for tea have increased (Ioddard &00/). Average price for medium ?uality tea sold in Indian mar'et increased from 4s.$/7,0 per 'g in 1,,, to 4s.1&071*0 per 'g in &00/ and it continues to rise. In India nearly // percent of total tea produce is sold through auction houses !ith the rest sold through private sales. "ven after the a+olition of compulsory auction in &001 the auction houses are very important constituent of tea mar'eting structure. The important feature of tea auction sale is that the producers=gro!ers do not ta'e part in the selling process directly. The +ro'ers in the mar'et (fe! in num+er !ho are registered +ro'ers in specific auction center) sell tea on +ehalf of producers. Bro'ers generally do not accept +id from un'no!n +uyers (Ta+le *). Bany industry insiders also +elieve that the large +uyers have co7operated on the auction floor to 'eep tea price lo!. An independent report commissioned +y the Indian Iovernment in &00& also suggested a merging of interest +et!een +ro'er and +uyers as !ell as co7operation +et!een +uyers at auction houses +oth of !hich prevented tea gro!ers from fetching a fair price at auction. (Table 5) The large +uying companies use their mar'et po!er (as they have their o!n net!or' of sales and mar'eting all over the country and e2port tea after +lending) to push do!n price and ta'e the advantage of depressed mar'et to pay lo! prices8 they are clearly +enefiting from the current situation. >industan :ever Tata Tea ;illiamson Bagor etc. are such po!erful +uyers having enormous influence on the mar'et and price of tea in India in general and Assam tea in particular.

These +ig tea companies !hich are in monopolistic competition in consuming countries al!ays try to sta+ili1e prices (Asopa &007) (Ta+le 6). The longer transaction time and higher transaction cost (li'e !arehousing charges transportation cost +ro'erage charges etc.) are some other pro+lems !ith the auction system. It ta'es a+out %/ days for the entire transaction processes to complete. (c) oor rice reali!ations The price of tea has +een on long term decline !hile production costs have +een rising putting pressure on tea gro!ers and !or'ing condition of la+ourers (Ta+le 11). The decline in prices has +een primarily due to gro!th in production in the face of sluggish demand (Ta+le 7). :o! prices for tea are generally passed on to the plantation !or'ers in the form of lo! !ages and !ithdra!al of +asic facilities li'e food health education etc. given that it is easier to cut cost +y reducing la+our cost (as the la+our has !ea' +argaining po!er) than raising the price of tea (difficult in the competitive mar'et economy) and in most of the cases producers have to remain competitive +y lo!ering !ages. Ba<or causes of poor price reali1ation are due to follo!ing reasonC J #ompetition +et!een producing countries for a share of the !orld mar'et !as one of the ma<or causes of falling price of Indian tea. ;orld production of tea is fairly diversified and not concentrated in a particular area. Dresently %6 countries of the !orld produce tea and many of them are +ig producers. They prevent the esta+lishment of a monopolistic leader in the !orld tea mar'et to ultimately allo!s fair and free competition in the mar'et. J J Demand for tea is rising very slo!ly (1./7& per cent) therefore the only !ay to increase Because of the dominance of auction system as a day3to3day intermediary +et!een mar'et share of e2port +y a country is at the e2pense of the competitors. producers and +uyers the actual producers have +een una+le to maintain direct contact !ith the ultimate customer of tea and there+y creating a long term relationship. J J J Tea is a perisha+le product. Its ?uality and flavour deteriorates very ?uic'ly. Therefore it is Tea producers have to stay in mar'et despite cut in prices of their produces as they have It is forecasted that tea production !ill increase over ne2t fe! years despite a slo!er gro!th fre?uently necessary to cut prices to clear stoc's. invested a huge sum of money8 many people are dependent on it and lac' of alternatives for them. in demand a trend that can only undermine price of tea in the long run. The present decline in prices !as on the +ac' of a 0.6 percent annual increase in production during 1,$*3&00/ is estimated at &.$ percent (Ta+le 7). In &00/ alone surplus of e2port availa+le over import re?uirement stands at a+out &*000 tones a surplus of & percent. /

There is a ma<or shift in the consumption and there+y composition of demand for tea in the

developed (importing) countries !hich has had unfavora+le effects on aggregate e2port earnings from tea. The increasing use of tea +ags and solu+le instant tea effectively reduces the ?uantity of tea needed per cup and also raise the demand for plain cheaper tea. The tea +ags accounts for 10 percent of the volume of !orld consumption3and it is still increasing. .actors !hich help to motivate consumption of instant tea include its ease of use as a cold din' and introduction of vending machines. These changes in the consumption patterns of tea have also significantly contri+uted to the decline in tea prices. (d) Defective market structure The tea value chain (#hart 71) comprises all the stages from green leaf production from the +ushes to finished product and sale to the customers. Kalue is added to the tea leaves at each stages of the supply chain each !ith associated cost (-EBE7&007). This includes the cost of pluc'ing and sorting factory pac'ing internal transportation !are housing sales changes (auction or direct sale) freight insurance interest +lending pac'aging and retailers sales cost etc. In general most of the agricultural produces value addition is done at the do!nstream in the higher processing and retail stages of supply chain3this is also true !ith tea. ;hile tea is ready to drin' item the do!nstream stages such as +lending pac'ing and ultimate mar'eting are the most profita+le one. This part of the value chain is controlled +y a handful multinational tea pac'ers and +ro'ers (-EBE &007). #oncentration is e2tremely high in the do!nstream of tea supply chain !here ,0 percent of !estern tea trade is controlled +y 7 (seven) B9#s $/ percent of !orld production is sold +y these B9#s. ("ist #$) As a result these B9#s can considera+ly influence !orld retail price. These are the indications that +ig companies have +een influential in 'eeping !orld mar'et price lo! !hich affect the sustaina+ility of tea industry. (e) Increase in cost of production ;hile mar'et prices for tea have +een falling the cost of production has +een on the rise in India putting do!n!ard pressure on profita+ility and income (Ta+le $). Ene factor !hich is closely related to the cost of production is of course productivity in terms of volume per hector !hich is affected +y change in climate soil fertility age of the tea +ush high over7head cost poor agricultural practices etc. The stagnation in productivity in many +ig estates is compounded +y high land la+our ratio. Droductivity declined in India from 1,,6 to &00/ in the large garden (Ta+le $). 6

:a+our cost accounts for around half of the unit cost of production and appro2imately // to

7/ percent of that la+our cost is on pluc'ing. >igh fuel cost dilapidated infrastructure including transportation and unsta+le la! and order situation in and around garden area etc. result in high cost of production (Ta+le ,). .ield and factory !or'ers productivity is also considered lo! in India. The impact of social cost (health food housing !ater etc.) in the large estates in percentage terms !or's out to a+out /7$ percent of the total costs. It implies an additional 4s.*.1& per 'ilo for manufactured tea in 9" 4egion of India and 4s. %.** per 'ilo in -outh India (-EBE7&007). Therefore it is assumed that around $0 percent of the cost of production goes to!ards fi2ed e2penses li'e fuel po!er and la+our (Ta+le 10). Inflationary pressures are no! pushing up these fi2ed costs further. :a+our unrest is another ma<or pro+lem faced +y planter=estates. :oo'ing into the profita+ility of the industry at the current price does not provide the !ay to meet these costs. 4ising costs and lo! productivity can have negative conse?uences on social and environmental aspects of production (sustaina+ility pro+lem) if these costs cannot +e passed on to the ultimate +uyer. Recommendations for improvement Despite +eing the largest producer and consumer of tea the Indian plantation sector lac's appropriate mapping of production and consumption levels. Due to a+sence of accurate estimates the formulation of long term industry !ide action plans have +een affected. The fact !hich emerges from the present crisis is that Indian tea has not +een glo+ally competitive. It has concentrated more on +uilding up its large estates and has given less attention to processing and improving the ?uality +y proper +lending and mar'eting3for higher price reali1ation of their products. @nli'e its 'ey competitors India does not have any po!erful +rand to support its promotion drive in the international mar'et. To !in +ac' the confidence of lost foreign mar'ets Accentore (a glo+al consultancy firm) has identified the need to revitali1e the image of Indian tea in that international mar'et. A vigorous campaign !hich include Indian tea logos and ma'ing Indian +rands accepta+le in those mar'ets. .urther an inspection agency should +e appointed to 'eep a ?uality chec' on the tea that is e2ported as the study also recommended that a ma<or thrust should +e made to improve ?uality for the long term sustaina+ility of tea industry of India. -tudy done +y the @nited 9ations .ood and Agriculture Ergani1ation (.AE &001) has suggested the need for reducing the unit cost of production through productivity gains capacity +uilding of small gro!ers streamlining mar'eting channels improving

infrastructure tailoring mar'eting activities to individual countrys demand propagating health +enefits of tea and promotion of organic tea using the tea mar'. This is e2actly !hat the domestic tea companies should do for their long term survival. Improvement of supply chain management in side the country and glo+al tea mar'eting net!or'. The tea industry in India has a legacy of corporate farming right from the day of British rule. The current situation in the sector has given ample reason for a rethin' on !hether corporate farming can really +oost agriculture. Time has come !hen tea companies should sell out their large estates to farmers for cultivation for ensuring more competitiveness and ma'e the industry via+le. This !ill reduce production costs also. In return +ig companies should enter into contract !ith tea gro!ers +y giving them technical and mar'eting support and all that is needed for +ac'!ard and for!ard lin'ages. Indian farmers have done !onders +y ushering in the green revolution and ensuring food security in this country. They !ill replicate the same in the tea sector also. As it is o+served retail price of tea have not declined !hen prices at the local auction centers have fallen so dramatically since 1,,0s noting the larger profit +y the pac'ers=retailers !ho are mostly at the end of the value chain. The issue here is the role played +y these companies in their o!n plantation implications of direct purchases +y them from other gro!ers and their relationship !ith +ro'ers at the tea auctions !here price manipulation is !idely suspected. These defects at the auction centers should +e investigated and remedial measures li'e 3 +ringing more transparency at the auction mar'et8 introduction of online auction practices for tea etc. should +e ta'en !hich !ill lead to changes in the structure of tea auctions to limit the manipulation +y the +ig players in the industry. International +rands li'e :iptons Broo'e Bond of >@: and Tetly tea of Tata Tea8 etc are the mar'et leaders and have great po!er in price determination in +oth domestic and international mar'et. This needs to +e stopped and proper investigation is needed to cur+ the !rong practices in the tea mar'et +y introducing ne! la!s to regulate the price movements. It has +een o+served that the actual producer of tea has no direct lin' !ith the ultimate consumer. Tea producers sell their products to the +ul' purchaser through direct sale or Therefore the producers do not understand the mar'et through auction to +ig +uyers.

demand = choice of the customer it is very important in todays mar'et economy for long term sustaina+ility of the industry. ;ith the !ithdra!al of sales restriction the gro!ers can directly go to the mar'et +y +uilding their o!n +rand. As the margin of profit is very high at

the present domestic retail mar'et Indian tea gro!ers should invest and ta'e this opportunity for the promotion of their +rand at the retail mar'et. .resh capital inflo! is needed right at this moment for the tea industry of India. Investment in ne! plantations and production machineries must come immediately to compete in the international mar'et. -ince tea industry has to compete glo+ally it is necessary that they should have access to glo+al capital at competitive rate. This can +ring life to the industry and those !ho live on it especially !or'ers. 4ecogni1ing the fact that the tea industrys crisis in India has multiple causes !hich re?uire a variety of solutions3one of the most important steps from the government part shall +e to introduce a stronger competition la! to cur+ the misuse of corporate +uying po!er and promote social o+<ectives at the garden level. ;e +elieve that focusing on the role of the larger tea companies !hich hold a great deal of po!er in Indian tea mar'et can have a significant influence over conditions for !or'ers on plantations and small gro!ers.

4eferences
Asopa K. 9. (&007) LTea Industry of IndiaC The #up that #heers has Tears Indian Institute of Banagement Ahmeda+ad ;. D. 9o.&00770770& (Muly). Bartha'ur 4an<it N Kripalini Dipa' LKision &0&0 4einventing the Indian Tea Industry to Achieve -ustaina+le Ilo+al #ompetitiveness and -ustaina+le :ivelihood. Ilo+al Banaged -ervice (IB-)..

httpC==!!!.gms!orldnet.com=images=visionO&0&0OreinventingOindianOteaOindustry.pdf
Bora #haytanya (&00%) LBar'eting of tea !ith special reference to the tea industries of Assam .inance India -eptem+er. #hattopadhyay -. -. (&001) LTea Boards cup of !oes KolC1, IssC&/. httpC==!!!.flonnet.com=fl1,&/=stories=&00&1&&000O$/00.html #houdhury Dr 4a+indra Kumar (&006) LIndian Tea Industry and Assam. httpC==!!!.nenane!s.com

Ioddard -amanth (&00/) LTea Brea'C A crisis +re!ing in India. Action Aid @K. International Tea #ommittee (IT#) Annual Bulletin of statistics &006=&007 :ondon @K Ka+tta Kiran (&00$) LBearish phase over for domestic tea sector The "conomic Times %0th Mune. Karma'ar Dr. K. I. N Baner<ee Dr. I. D. (&00/) LThe Tea Industry in IndiaC A survey Department of "conomic Analysis and 4esearch 9ABA4D Bum+ai (Eccasional paper7%,). Kuman Driya (&00$) L#hallenges that Indian Tea Industry faces httpC==!!!.commodityonline.com :ines Thomas (&006) L-ustaina+le livelihoods for Indian Tea ;or'ersC The International Dimension Department of International Development Tradecraft "2change (Bay). Bandal Kohinor (&00%) LTea consumption data stirs up a storm !!!.thehindu+usinessline.com=&00%=0$=&,=stories=&00%0$&, Tea Board Tea -tatistics Kol'ata ;al -anne Kan der (&00$) L-ustaina+ility issues in the Tea -ectorC A #omparative Analysis of si2 :eading Droducing #ountries -EBE (-tichting Ender1oe' Bultinationale Endernemingen) Amsterdam 9etherland. Business :ine .riday. August &,.

-harma Asho' B. (&001) LTea Industry in crisisC >as corporate farming failedP The .inancial "2press Ect 1$.

10

Appendi2
Table $% &lobal Tea production and '(port in )**+ (In metric ton)
Country ,hina India 2ri "anka 3enya Turkey Indonesia 4ietnam 5apan 6rgentina 7angladesh Mala8i 9ganda Tan!ania Iran Tai8an :ther Total Production 10&$06&* -55-*. %10$&& %10607 1*&000 1*00*, 1%&000 ,,/00 $0000 /%&6/ */010 %67&6 %1%*$ &0000 1,%*/ 1&$1/7 %/%&$00 World Share (%) 0.&, */). 0.0, 0.0, 0.0* 0.0* 0.0* 0.0% 0.0& 0.0& 0.01 0.01 0.01 0.01 0.01 0.0* Export &$6/,* )**0++ %1*,1/ %1%7&1 //00 ,/%%, 106000 16$1 707&% *7,* *1,6& %&6,, &*1%& 6000 1,6& 6*,&0 1/71$0$ World Share (%) 0.1$ */$1 0.&0 0.&0 0.00 0.06 0.07 0.00 0.0* 0.00 0.0% 0.0& 0.0& 0.00 0.00 0.0*

-ourceC -EBE +ased on annual +ulletin of statistics &007 IT#. N Tea Digest (&00/7&006) Tea Board of India .

Table)% 'stimates of domestic consumption of tea in India

;ear 1,,$ 1,,, &000 &001 &00& &00% &00* &00/ &006 &007 &00$ &00, &010 -ourceC pro<ected +y IIB Kol'ata. Domestic consumption (in M kg) 61/ 6%% 6/% 67% 6,% 71* 7%/ 7/7 771 7$6 $0& $1, $%7

Table 1% '(port of Tea from India to different countries during $--0#)**<

Importing countries $--0 (Million tons) 93 =rance &ermany Ireland >etherlands &1&7% %16 /166 &/17 1,%, )**< (Million tons) 17606 17/ *777 &%/6 &,7* Decline Decline Decline Decline Increase '(port result

11

oland 922R ,anada 926 2audi 6rabia 96' Iran Ira? 5apan akistan 2yria 'gypt 2udan 6ustralia India@s total e(port Aorld e(port

,$7, ,*/$& 7/& %1,* %7$0 &%0*0 10,7 1011$ &,11 1%,& 9A 66/1 /67 1&1$ &076%, 1%0*$,6

/10* *$/0/ 1&0* /7$1 6,, &*7** %&7& &*7%& &6&/ %/&6 &*67 100 ,6 *$0% 17,,/7 1/*0001

Decline Decline Increase Increase Decline Increase Increase Increase Decline Increase Increase Decline Decline Increase Decline Increase

-ourceC Tea Board Tea -tatistics Kol'ata N Annual Bulletin IT# :ondon.

Table <% The brokers and their sale volume in the period )**$#*) in &T6, 2erial no/ 1 & % * / 6 7 $ , >ame of 7roker 5/ Thomas ,arritt Moran 6ssam Tea 7rokers Tea 7rokers ,ontempory Target 'astern Tea 7rokers 6ssociated 7rokers 6/ A/ =iggis aramount Buantity (in kg) /06,6%6&.& %&,$%&/&.* $/1$0*1.7 10&01,*&./ 111&$&7/.% 16,7$$,7.7 &*01,61.& 1$$0/*$.6 6170%$/.* ercentage (C) %/.,7 &%.*0 6.0* 7.&* 7.$, 1&.0/ 1.70 1.%% *.%$

-ourceC -tatistical #ell ITA#.

1&

Table 5% rice movement of Tea in &T6,

(Drice in 4s per 'g) eriod ,/T/,/ :rthodo( 6pril# March 6vg/ price 6vg/ price $--+#$--. /%.71 //.%0 $--.#$--0 77.&6 $$.10 $--0#$--7*.*& 71.0& $---#)*** 7,./1 76.66 )***#)**$ 7&./1 67./6 )**$#)**) 6/.** /$.*$ )**)#)**1 6/.00 /$./0 )**1#)**< /$./6 /%.$7 )**<#)**5 6$.$* 7*.16 )**5#)**+ 61.7, 60.71 )**+#)**. 67.7/ $0.&6 -ourceC Iu!ahati Tea Auction #entre 5ear Boo' &0067&007 Iu!ahati. Table +% 7ig buyers in &T6, and their total intake of Tea $--<#$--5 9ame Ruantity +ought 7rook 7ond India vt "td "ipton India vt "td Tata Tea "td :ipton India "2port :td Bond :td D. Dayal+hai N #o. M. K.Ioyal N #o. Kesaria N #o. Duncan Tea #o. >arry N #o. Eindustan "ever "td Dur+anchal "nterprise "stern "nterprise "astern Agency Kesaria "2port -ourceC -tatistical #ell ITA# Iu!ahati (in 'g) *1/6$$$7.$ &/760*6*.0 6$0600%.* 6&76%,0.6 &*7/7/&.1 1$6/17,.& 1//**&6.0 1&/6*,/./ 1111/$6.1 10%0/$6.1 0to total sale %0.71 1,.0* /.0% *.6* 1.$% 1.%$ 1.1/ 0.,% 0.$& 0.76 Ruantity +ought (in 'g) 0 to total sale )***#)**$ Dust 6vg/ price /0.$1 7/.%* 6,.*& 77.,, 70.$% /$.&1 61.$0 /7./% 6$.*$ /,.&6 6$.6% Total tea 6vg/ price /&.6, 76.67 7&.7& 7,.0% 71.,7 6%.17 6*.0* /$.&* 6$.76 61.07 6$.06

7%00/%1.6

/.1/

16*&*&$.& &$&//16.% &./%//76., 1/%7/6/.% %0*%,0,,.* %61%$66.& &/1$&7*.& 1%$606&.0 16%,$71.%

1.16 &.01 1.76 1.0, &1.*, &.// 1.7$ 0.,$ 1.16

Table .% Aorld 2upply and Demand (In million ton) ;ear $--* )*** )**$ )**) )**1 )**< )**5 )**+ ( ) )**. ( ) Aorld supply &/77.10 &,%%.*, %061.*% %0$6./, %&16.76 %%&$.6/ %*6$.&, %/77.&0 %7&6.70 Aorld demand &/6%.$7 &$$1.%/ %00&.** %01/.61 %1/1.71 %1$&.0/ %%6&.,6 %*%$.,, %6&0.06 1% DifferenceD2urplus Q 1%.&% Q /&.1* Q /$.,, Q 70.,$ Q 6/.0/ Q 1*6.60 Q10/.%% Q 1%$.&1 Q 106.6*

-ourceC Annual +ulletin of statistics IT# :ondon. Table 0% 6verage yield of Tea in different countries (5ield in 'g= hectare) ,ountries 6rea under cultivation )*** )**$ )**) India 5*<1++ 5*-..* 5$$-<* 2ri "anka 1$$,71 1$$,71 1$$,71 Indonesia 1/7*$$ 160,,1 16&000 3enya 1&&&%6 1%1/$1 1%&000 ,hina 10$,000 11*0700 11//000 Myanmar 6$%,& 6$%,& 6$%,& -ourceC Bafatlal -ecurities :td. Bum+ai )*** $+.16&% ,,, 1,%% 6&7 $77 ;ield per hectare )**$ $+.5 1/6$ 1001 &&%, 61/ $77 )**) $+$< 16*1 10&/ &17/ 61, $77

Table -% ,ost of production for made Tea in some producing countries in the year )**1
roducing countries 2ri "anka India 3enya Mala8i 4ietnam Indonesia ,ost of production (in 92DD kg) 1.70 1./% 1.1$ 0.,, 0.$/ 0./$

-ourceC "stimated +y -EBE Tea -tatistics ITA Indian Tea -cenario &00*

Table $*% ,ost of production in Rs per kg of green leaf of small gro8ers

,omponents of cost Inputs7 .ertili1ers= Desticides etc. ;ages Direct "2penses Everheads Total cost per 'g of green leaf Average price reali1ation 6ssam 1.7* %./$ 0.1/ 0.$1 6.&7 7.*1 Aest 7engal &.1& &.$7 0.6, 0.6* 6.%& /./ Tripura 1.6 &.7% 0.%& 0.*& /.07 *./* >ilgiris 1.7$ &.,& 0.11 0./& /.%% *.$7 3erala 1.&6 *./* 0.1, 0.6 6./, /.%/

Source: Complied report on small tea growers (2

!)" #ea $oard o% &ndia.

Table $$% Buantity sold and 6verage rice in &T6,

1*

eriod 1,,67,7 1,,77,$ 1,,$7,, 1,,,700 &000701 &00170& &00&70% &00%70* &00*70/ &00/706 &006707

Total ?uantity in m kg 1*7 1%7 1*7 160 1*& 1*1 1&/ 1%% 1&, 1*1 1*,

6verage price in Rs /&.6, 76.67 7&.7& 7,.0% 71.,7 6%.17 6*.0* /$.&* 6$.76 61.07 6$.06

-ourceC 5ear +oo' (&0067&007) +y Iu!ahati Tea Auction #ommittee. Table $)% Aorld tea e(port price for last fe8 years (in 92 F per kg)
Countries India 7angladesh 2ri "anka Indonesia 3enya 5apan ,hina Mauritius '((( &.%$ 1.%/ &.&$ 0.,, 1.,% 1*.%% 1.7 6.0& 2 &.0* 1.&$ &.%7 1.06 &.1& 1/.$7 1./& *.%7 2 ' 1.,/ 1.&* &.&$ 1.00 1.7/ 1%.11 1.%7 /.&7 2 2 1.7, 1.1, &.&* 1.0% 1./$ 1*.60 1.&1 /.7& 2 ) 1.,7 1.&, &.&/ 1.0, 1.6$ 16.&, 1.%$ /.6% 2 * &.06 9A &.*1 1.1$ 1.6* 1$.1/ 1./6 $.&, 2 ! &.0, 1.&$ &./$ 1.1, 1.67 1$.%* &.06 7./7 2 + &.0% 9A &.6* 1.*1 &.0, 16.%7 1.$$ $.**

-ourceC Annual Bulletin of -tatistics &006 IT# :ondon.

1/

"ist # $ M>,s dominate the global tea market $/The companies dominate the Tea trade at the global level 9nilever ( 7rooke 7ondG "ipton D 9nilever Trading ,ompany 9T,G 93# The >etherlands) 4an Rees (TraderD 7lenderG 2upplying many packersG part of Deli 9niversal ,orporationG >etherlands ) 5ames =inlay (TraderG roducerG ackerG 93) Tata Tetley D 2tansand ( roducerG TraderG ackerG 93)

)/Important Tea ackers in the Aorld 9nilever ("ipton is a very strong brand 8ith a 8orld market share of $* C) Tetley (Tata &roup) R/ T8inings ( 6ssociated 7ritish =oods) 6jeepay &roup (Typhoo tea) :stfriesche Tee &esellschaft :T&% Major &erman company 8hich also has activities outside &ermany

16

;ear 1,61 1,71 1,$1 1,,1 &001 &00/ &006 &007

Aorld //* 667 $1$ 107, 1%,* 1/67.&0 1/$$.7, 1/$7.&0

India &06 &0& &*1 &1& 1$% 1,,.0/ &1$.7% 17$.7/

India@s share as percentage of 8orld e(port %7.1$ %0.&$ &,.*6 1,.6/ 16.$& 1&.70 1%.77 11.&6

Table $1% Aorld '(port (In Million 3g ) -ourceC Annual Bulletin of -tatistics &006 IT# :ondon

17

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