Sri Lanka low grown tea prices slump to lowest in three years
ECONOMYNEXT – Prices of Sri Lanka’s low grown teas, which make up the bulk of the crop fell to their lowest levels in three years at recent auctions, with political and economic troubles in key markets continuing to dampen demand.
Tea prices which had perked up at the Colombo auctions last month have begun to fall again, except for well-made teas and those from the Uva region whose quality season is underway, brokers said.
Tea prices have been falling since the latter half of last year because troubles in key markets like Russia, where the rouble was devalued, and the Middle East, had hit demand.
Lower demand continued for the 3.5 million kilos of Low Grown teas that were on offer at last week’s auctions, brokers John Keells Ltd. said.
At the previous week’s auctions, the Low Grown orthodox average of 395.50 rupees a kilo was the lowest seen in recent times, they said.
The last recorded lowest average was witnessed from the of 7-8 August 2012 which was 396.63 rupees a kilo.
There was limited demand from the Russian and Iranian buyers. Syria, Turkey, Saudi Arabia and other Middle Eastern markets were “selectively active”, the brokers said.
“Once again, the buyers at today’s sale were following quality very closely,” John Keells Ltd. said in a report on last week’s auctions.
“Well-made clean teas with fair liquors were absorbed at prices on last week’s levels. Hence, it is imperative that all producers strive to maintain a good leaf appearance and brighter infusion in order to derive the maximum benefits of the present market conditions.” (Colombo/August 16 2015)