Tea output to fall in Assam, West Bengal

Tea production in Assam and West Bengal is set to register a sharp decline due to a prolonged dry spell and rising temperature.

Data compiled by the Indian Tea Association (ITA) shows the rainfall deficit for West Bengal was 31-42 per cent during January-March 2012 compared to the same period last year. The new arrivals at auctions slated for the next couple of weeks reflect the fall in production. Auction Sale 14 and 15 at Kolkata saw a fall of 22 per cent, in packages. For Siliguri, the drop is 25 per cent, while Guwahati tops at around 50 per cent.

“Upper Assam estates in the south bank of the Brahmaputra are also experiencing severe drought conditions, with rainfall deficit of 45 per cent in Dibrugarh and Tinsukia districts and around 38 per cent deficit in Golaghat. Categorisations made by the meteorological department for Assam and West Bengal, based on the cumulative rainfall figures, show Assam and West Bengal rain as “scanty” indicating reduction of 60 per cent as compared to last year,” a release from the Association said.

The output is estimated to drop by 60 per cent up to March as compared to 2011. The crop in Assam and West Bengal up to March, as compared to 2011, is therefore expected to touch 20 million kg, as against 46 million kg for the corresponding period in 2011.

Not surprisingly, prices of good quality new season tea have been soaring. Private sales have seen an increase of Rs 60-80 a kg in prices over the opening last year.

Moreover, the overall global picture for CTC tea is not particularly rosy. Kenya has also reported severe dry conditions, which is likely to impact global production in the current financial year.

The tea industry in India closed 2011 at a level of 988 million kg, with prices averaging at around 2010 levels for both Assam and West Bengal. Companies operating in Assam and West Bengal were pushed to increasing wages and the wage component forms 28 per cent of the total production cost.