Sri Lanka tea prices seen remaining high on global shortfall
ECONOMYNEXT – Sri Lankan tea prices were mostly firm or higher at this week’s auctions with high grown varieties rising sharply, some hitting record levels, and prices seen remaining high owing to the global shortfall in production, brokers said.
Asia Siyaka Commodities said low grown teas, which account for the bulk of the crop met with “fair demand” and most were firm at last week’s levels while others appreciated in value.
There was good general demand for teas from the estates and prices strengthened once again, they said.
“Western BOPs attracted more widespread demand and better teas gained Rs.20 to Rs.30 a kilo,” Asia Siyaka Commodities said.
A Florence PF1 grade, in the High Grown CTC category, sold at a record price of Rs.760 a kilo, beating last week’s record of Rs.730 a kilo, while a Dust 1 from Mattakelle hit Rs950.
John Keells PLC tea brokers said Sri Lankan tea prices are seen remaining high this year on account of the global shortfall in production, with good demand witnessed at the auctions.
“During the third quarter of 2017, price levels at the Colombo auctions have shown an increase over the same period in the previous year,” they said in a report.
“While world tea production is sluggish, tea prices are expected to remain moderately high in the last quarter of 2017.”
John Keells said the rise in tea consumption too has had an impact on prices.
Crop deficits have been recorded in Kenya and Bangladesh over the past 12 months compared to the previous year, creating a global shortfall.
(COLOMBO, October 13, 2017)