Record volume, good demand at penultimate tea auctions of 2018

Friday, 14 December 2018 00:00 - - {{hitsCtrl.values.hits}}

By Forbes and Walker Tea Brokers

The penultimate sale of the year has concluded; it had on offer 7 m/kg, which records the largest volume on offer since June 2018. There was good demand.

Ex-Estate offerings comprised of 1.1 m/kg recording a gain over the 0.9 m/kg on offer in the previous week. In the back drop of the uncertainty of availability owing to the unrest at the plantations combined with a selection of better quality teas on offer, resulted in tea prices in the High Grown sector appreciating by Rs. 20 per kg and more all round. However, this momentum was not maintained throughout the sale, particularly for the brighter teas in the Below Best and bottom end of the market.

Best Western BOP’s gained Rs. 20 per kg and substantially more following special inquiry. The corresponding BOPF appreciated Rs. 30 per kg and substantially more for select invoices following special inquiry. Teas in the below best category together with the better liquoring teas at the lower end of the market appreciated fairly significantly during the first half of the sale which momentum was not maintained throughout the Auction. The plainer sorts continued to sell around last week’s levels. Nuwara Eliya’s continued to be a weak feature particularly due to quality parameters. Udapussellawa BOP’s were irregular and barely steady, whilst corresponding BOPF appreciated Rs. 10-20 per kg. Selection of Uva BOP’s continued to sell well, whilst its corresponding BOPF was substantially dearer following special inquiry. Other BOP/BOPF from the Uva region generally appreciated Rs. 10-20 per kg in most instances. Better demand for BP1’s, which consequently appreciated by Rs. 30-50 per kg and more, whilst corresponding PF1’s were firm and Rs. 10-20 per kg dearer.

Low Growns totalled 3 m/kg in the Leafy/ Tippy catalogues. There was good demand. In the Leafy catalogue, BOP1/OP1’s, particularly the well-made types were fully firm to dearer. Others though irregular were mostly firm. Better OP/OPA’s too sold around last levels whilst teas at the lower end which were irregular at the commencement too strengthened towards the close. Select best PEK/PEK1’s were fully firm. Others which were easier at the commencement gained as the sale progressed to close at fully firm to dearer rates. In the Tippy catalogue too, FBOP/FF1’s were fully firm dearer. Particularly, the better made sorts. At the lower end too, cleaner types were dearer to last. Others were irregular. In the Premium catalogue, there was improved demand all around and prices gained on last for most teas. There was good demand from shippers to CIS, Turkey, Iraq, Saudi Arabia and Dubai.

Current prices are encouraging and gives some promise to tea prices in the immediate future, although it is significantly lower in comparison to the corresponding Auction prices of last year in Rupee terms and records an even sharper negative variance in US Dollar terms.