Tea production in South India is set to decline for the fourth consecutive year owing to erratic monsoon and adverse weather in the growing regions.
During the first seven months (January-July) of this year, tea production declined 3.8% to 138.1 million kgs from 143.5 million kgs in the same period last year.
Though northern states also reported lower crop due to climatic variation during the same period, southern region witnessed a longer dry spell in the recent years.
“The fall in tea crop of this magnitude makes it difficult to recoup the losses in the remaining months, as South India will be reporting a decline for the fourth year in succession,” R Sanjith, spokesperson, United Planters’ Association of Southern India (Upasi) said on Thursday.
Tea production in North India during the first seven months was 332.7 million kgs against 348.1 million kgs, a year-on-year decline of 4.4%. As a result, the all-India output slipped by 4.2% to 470.8 million kgs from 491.6 million kgs during the same period.
For 2011, tea production in South India was 240.9 million kgs, a decline of 1.02% over the previous year.
Southern states comprising of Tamil Nadu, Kerala and Karnataka account for 24% of the country's annual output.
The total output during the year was 988.3 million kgs, a marginal growth of 2.3% over the previous year.
"In North India, conventionally after the winter dormancy phase, crop recovers from March, but this year largely due to the erratic weather both first and second flush were not only short but also smaller in size, which gives an indication of bleak tea crop for 2012,” Sanjith told Business Standard ahead of the 119th annual conference of Upasi atop the hill town Coonoor.
Adverse weather is not confined to India alone, as most of the major tea producing nations reported erratic weather patterns, resulting in lesser crop intake by 64.8 million kgs during the first half of 2012.
The crop was lower in all major producing countries during the first five to six months, with Kenya reporting a drop of 21.5 million kgs followed by North India by 17.9 million kgs, Uganda by 8.8 million kgs and Sri Lanka by 7.4 million kgs.
Lower crop and higher domestic consumption have, however, pushed tea prices up.
While South Indian prices during January to August 2012 were up 21% at Rs 84.24 per kg, North India reported 7.3% rise to touch Rs 126.40 per kg during the same period. Overall, tea prices have gone up 9.7% to Rs 111.41 per kg during the first eight months of this year as against a year ago.
“We expect the supply of tea to be lower in the world market but higher demand will result in positive price movement for the crop this year,” Sanjith added.