Russia-Ukraine war may lead to fall in tea prices: GTABA

STAFF REPORTER

GUWAHATI: The Guwahati Tea Auction Buyers' Association (GTABA) has expressed the apprehension that the ongoing Russia-Ukraine conflict may ultimately result in a further fall in prices of Indian tea.

According to GTABA secretary Dinesh Bihani, Russia is the largest export destination for Indian tea, and the Commonwealth of Independent States (CIS) countries are also fond of Indian tea. "If we lose this market, then the prices of Indian teas will further fall as there is a surplus of tea in the domestic market," he said.

He informed via a press release that India's tea exports to the CIS countries stood at 40.17 million kg (mkg), valued at around Rs 744 crore, between January and November last year, as per statistics available on the website of the Tea Board of India. Out of this, exports to the Russian Federation stood at 30.89 mkg, estimated at Rs 558 crore. It accounts for nearly 77 per cent of the total exports to the CIS.

The total export to Ukraine during this period was at 1.6 mkg (valued at around Rs 30 crore); Kazakhstan 6.25 mkg (Rs127 crore), while exports to other CIS countries stood at 1.43 mkg (Rs 29 crore).

Exports during the same period in 2020 stood at 46.39 mkg, valued at around Rs 823 crore. Bihani said that India's tea exports during the calendar year 2021 were adversely impacted due to the lack of clarity overpayment mechanism with Iran and the higher prices of Indian CTC (crush-tear-curl) tea compared to the Kenyan counterpart. While actual figures are still not available, estimates suggest that tea exports from India are likely to be lower by around 12-13 per cent (close to 180 million mkg) during the calendar year 2021, against 207.58 mkg in 2020.

If the Russia-Ukraine war goes on for a long time and more sanctions are imposed by NATO countries, then it will be very difficult for the tea sector in India, he said.

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