Rise in dollar prices in Kenya missing in Colombo tea auctions

Friday, 20 July 2012 00:31 - - {{hitsCtrl.values.hits}}

Colombo tea auctions appear to be missing the rise in dollar prices enjoyed by Kenyan counterpart in recent months, according to Forbes and Walker Tea Brokers Ltd.

“Kenyan tea auction prices in the recent past have being appreciating steadily, primarily due to the significant crop short fall experienced in the African region in addition to the global short fall. Consequently, at the Mombasa auction last week, average prices for teas of Kenyan origin surpassed the USD 3.40 level, whilst all African teas sold at the Mombasa auction last week averaged between USD 2.90-3.00. In comparison Colombo auction averages for high growns recorded Rs.355.45 (USD 2.63),” Forbes and Walker said in its weekly tea market report.

“Diminishing availability and Ceylon’s being cheaper in comparison possibly triggered buyers to step up on their purchases this week,” it added suggesting finally there are some signs of relief to the producers.

John Keells in its market report noted that in dollar terms the prices for Low Growns are around 15 to 16 US cents lower when compared with the same period in 2011.

Meanwhile Forbes commenting on this week’s auction said a total of 7M/kg came under the hammer of which 1.1M/kg comprised of Ex-Estate offerings.

This week’s Ex-Estate offering comprised of a better selection of Westerns, whilst few select Uva/Udapusselawa’s were brighter. Consequent to the extremely limited availability of BOPs, the best Westerns gained Rs.10 to 20 per kg on average and substantially more for select liquoring teas. Brighter BOPF’s gained Rs. 15 to 20 whilst all other BOP and BOPF’s appreciated Rs. 10 on average. CTC’s were irregular following quality and sold around last levels. Nuwara Eliya’s continued to sell well although lower to last.

Considering the tight supply situation, both local and global, it is hoped that tea prices in Colombo would appreciate in keeping with other main auction centres in USD terms from now on.

Low Grown’s comprised of approximately 3.4M/kgs in the Leafy/Tippy catalogue. In the Leafy catalogues, OP/OPA’s particularly the cleaner types met with wide spread demand and gained Rs. 5 to 10 per kg and more. PEK’s too were fully firm to dearer. OP1’s were firm to selectively dearer whilst BOP1’s met with good demand and gained Rs. 5 to 10 per kg and more. In the Tippy catalogue, a select range of better FBOP/FBOPF1’s were firm to dearer whilst the others declined Rs. 10 to 15 per kg. A cross selection of well made Tippy invoices too sold around last levels whilst others were lower to the preceding sale. At the lower end too prices were mostly irregular and were often lower. There was good demand from CIS, Turkey, Iraq, Lybia, Kuwait together with Dubai this week.