Tea production for 2015-16 estimated to fall by 1.5%

Unfavourable weather conditions and considerable labour migrations have hurt the industry

Tea output in the country in the ongoing fiscal year is estimated to decline by atleast 1.5 percent owing to issues ranging from bad weather conditions and climate change to wage issues with plantation labourers.

"It is difficult to estimate the annual production for this year. However, in all probability, we should close at around 1190 million kg (mkg) as against last year's 1207 mkg", chairman of Indian Tea Association, A.K. Bhargava said.

The country's oldest tea producer's association, founded in 1881 held its 132nd annual general meeting here on Friday.

In the ongoing year, until October, production in the north Indian tea gardens has declined by 8.78 mkg while average tea prices fell by Rs. 5.30 per kg.

"Since the beginning of 2014, Assam has been losing crop heavily during peak months and the trend continues", he said.

Unfavourable weather conditions have also impacted global Black Tea production which fell by around 95 mkg until September this year.

According to the official, wages - which account for 60 percent of input costs - and industrial relations have also hit tea producers hard.

In the current fiscal period, the tea industry saw considerable labour migrations who moved over to other industries than prefer to stay in the tea gardens on account of issues related to quality of life and wages.

Wage settlements, concluded between the tea producers and the labourers in Assam and West Bengal had helped ease the situation.

Former chairman of Tea Board of India, M.G.V.K. Bhanu, who was the chief guest at the meeting said the estates needs to invest more on their workers to retain them. Companies, hence needs to fetch higher prices for their tea to sustain the investment.

"Health, housing and educational facilities has to be provided to retain workers", he said.

For the last 10 years, input costs in the gardens has grown by 10 percent CAGR (Compounded Annual Growth Rate) per annum while prices grew by 6-7 percent CAGR.