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Economic Times
9 hours ago
- Business
- Economic Times
Raw tea leaf prices crash 50% amid surging imports and weak export demand
Synopsis Raw tea leaf prices dropped nearly 50% year-on-year in August to ₹14/kg due to rising low-cost imports from Kenya and Nepal and export uncertainty. Retail tea prices also fell 10–15%. This has hurt 24 million small growers across India. Oversupply, weak exports, and softening auction prices suggest continued pressure on prices through 2025, say industry leaders. Prices of raw tea leaves produced by small tea growers crashed nearly 50% year-on-year in August to Rs 14 per kg due to rising imports of comparatively lower-priced tea from Kenya and Nepal, and uncertainty over Trump's tariffs impacting export demand from the US. ADVERTISEMENT Consequently, retail prices of processed tea, already on a downward spiral, are likely to ease further, industry executives and consumer goods companies Hindustan Unilever (HUL) and Tata Consumer Products (TCPL) said recently. Retail price of tea is currently trending 10-15% lower from the levels seen in last July-August period. The sharp fall in raw tea prices is impacting an estimated 24-million small tea growers in Assam, West Bengal, Himachal Pradesh, and South India, who grow teas in small parcels of 1-5 acres. These growers contributed 54% to the country's total tea production in 2024, according to Tea Board of India data. To be sure, prices of raw tea have been under pressure since April-May, selling at Rs 22 per kg. 'Black tea tea imports have shot up as Kenya's production is more and they exported to India at a lower price, bringing down overall prices,' said Bijoy Gopal Chakraborty, president of Confederation of Indian Small Tea Growers Association (CISTA). As per government data, India's tea imports doubled to 50.14 million kg in FY25 from 25.21 million kg in exported around 17 million kg tea to the US, comprising around 7% of its total tea exports of 255 million kg—the highest in a decade. ADVERTISEMENT Tea prices have also fallen due to over production, pointed out Viren Shah, managing director at Gujarat-based Jivraj Tea. 'At the retail end, we do not see an immediate recovery in prices,' he produced 359.32 million kg tea in the first half of 2025, a 4% rise from a year earlier. ADVERTISEMENT Average auction price of common variety or CTC black leaf tea fell to Rs 236 per kg from Rs 267 per kg between April and mid-August, according to the Calcutta Tea Traders Association which tracks tea prices auctioned in Kolkata. Dust variety tea dropped to Rs 269 per kg from Rs 277 per kg in the period under review. Locally, retail prices of processed tea have fallen 10-15% year-on-year during July- August. ADVERTISEMENT Tea prices are about 13-15% less than last year as per recent auctions, and the trend is expected to stay weak for the rest of the year, Sunil D'Souza, managing director at TCPL told analysts in too has adopted a pricing strategy for tea based on replacement cost instead of consumption cost. In its earnings call on July 31, chief financial officer Ritesh Tiwari said a substantial portion of the company's tea was procured seasonally between June and September last year, when commodity prices were at its peak. ADVERTISEMENT 'Over December and March quarter, tea prices have sequentially softened. Consequently, while the cost of the tea consumed during the quarter was higher, we decided not to pass on the full cost to consumers,' he said. Tiwari also noted that consumers have downgraded their tea, making it a very price-sensitive category, leading HUL to price it at replacement cost. 'The (new) crop is a good production crop and all things point now that sequentially prices will come off,' he said. (You can now subscribe to our Economic Times WhatsApp channel) (Catch all the Business News, Breaking News, Budget 2025 Events and Latest News Updates on The Economic Times.) Subscribe to The Economic Times Prime and read the ET ePaper online. NEXT STORY
Time of India
10 hours ago
- Business
- Time of India
Raw tea leaf prices crash 50% amid surging imports and weak export demand
Prices of raw tea leaves produced by small tea growers crashed nearly 50% year-on-year in August to Rs 14 per kg due to rising imports of comparatively lower-priced tea from Kenya and Nepal, and uncertainty over Trump's tariffs impacting export demand from the US. Consequently, retail prices of processed tea, already on a downward spiral, are likely to ease further, industry executives and consumer goods companies Hindustan Unilever (HUL) and Tata Consumer Products (TCPL) said recently. Retail price of tea is currently trending 10-15% lower from the levels seen in last July-August period. The sharp fall in raw tea prices is impacting an estimated 24-million small tea growers in Assam, West Bengal, Himachal Pradesh, and South India, who grow teas in small parcels of 1-5 acres. These growers contributed 54% to the country's total tea production in 2024, according to Tea Board of India data. To be sure, prices of raw tea have been under pressure since April-May, selling at Rs 22 per kg. 'Black tea tea imports have shot up as Kenya's production is more and they exported to India at a lower price, bringing down overall prices,' said Bijoy Gopal Chakraborty, president of Confederation of Indian Small Tea Growers Association (CISTA). As per government data, India's tea imports doubled to 50.14 million kg in FY25 from 25.21 million kg in FY24. India exported around 17 million kg tea to the US, comprising around 7% of its total tea exports of 255 million kg—the highest in a decade. Tea prices have also fallen due to over production, pointed out Viren Shah, managing director at Gujarat-based Jivraj Tea. 'At the retail end, we do not see an immediate recovery in prices,' he said. India produced 359.32 million kg tea in the first half of 2025, a 4% rise from a year earlier. Average auction price of common variety or CTC black leaf tea fell to Rs 236 per kg from Rs 267 per kg between April and mid-August, according to the Calcutta Tea Traders Association which tracks tea prices auctioned in Kolkata. Dust variety tea dropped to Rs 269 per kg from Rs 277 per kg in the period under review. Locally, retail prices of processed tea have fallen 10-15% year-on-year during July- August. Tea prices are about 13-15% less than last year as per recent auctions, and the trend is expected to stay weak for the rest of the year, Sunil D'Souza, managing director at TCPL told analysts in July. HUL too has adopted a pricing strategy for tea based on replacement cost instead of consumption cost. In its earnings call on July 31, chief financial officer Ritesh Tiwari said a substantial portion of the company's tea was procured seasonally between June and September last year, when commodity prices were at its peak. 'Over December and March quarter, tea prices have sequentially softened. Consequently, while the cost of the tea consumed during the quarter was higher, we decided not to pass on the full cost to consumers,' he said. Tiwari also noted that consumers have downgraded their tea, making it a very price-sensitive category, leading HUL to price it at replacement cost. 'The (new) crop is a good production crop and all things point now that sequentially prices will come off,' he said.
The Print
10-07-2025
- Business
- The Print
Small tea growers urges Centre for fair price discovery mechanism
It said the Tea Board should undertake a detailed study to determine an equitable price-sharing ratio between small growers and factories. In a letter to Commerce Minister Piyush Goyal, the Confederation of Indian Small Tea Growers Associations (CISTA) suggested a price protection scheme modelled on the lines of the minimum support price (MSP). Kolkata, Jul 10 (PTI) Small tea growers, who contribute more than 50 per cent to the crop production of the country, have urged the Centre to set up a fair and transparent price discovery mechanism so that they can realise a proper value by selling leaves to factories. Small growers are facing the persistent challenge of poor price realisation, which is undermining the sector's sustainability, CISTA president Bijoy Gopal Chakraborty said. Small growers contribute more than 52 per cent to the country's tea production, and a proper price realisation mechanism should be identified so that livelihoods are sustained, he said. Chakraborty said the association has already submitted a detailed status paper to the Commerce Ministry in May 2023, outlining the structural bottlenecks faced by the sector, which is suffering from chronic price realisation challenges. He said the concept of minimum benchmark price should be replaced by a new methodology linked to the total sales value so that growers receive a fair and remunerative price. CISTA favoured the Sri Lankan model, under which surplus earnings over auction averages are shared equally between factories and growers. Proposing a price protection scheme for small growers, it said the average green leaf price currently ranges between Rs 22 to Rs 25 per kg, while the cost of production is hovering between Rs 17 and Rs 20 per kg. The yield on a modest margin is Rs 5 per kg for the growers, it said. On the other side, agents typically charge Rs 2 per kg, the CISTA said it is a big disincentive, and growers should be able to sell directly to factories. PTI dc SOM This report is auto-generated from PTI news service. ThePrint holds no responsibility for its content.
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Business Standard
10-07-2025
- Business
- Business Standard
Small tea growers ask Centre to set up fair price discovery mechanism
In a letter to Commerce Minister Piyush Goyal, the Confederation of Indian Small Tea Growers Associations (CISTA) suggested a price protection scheme modelled on the lines of the minimum support price Press Trust of India Small tea growers, who contribute more than 50 per cent to the crop production of the country, have urged the Centre to set up a fair and transparent price discovery mechanism so that they can realise a proper value by selling leaves to factories. In a letter to Commerce Minister Piyush Goyal, the Confederation of Indian Small Tea Growers Associations (CISTA) suggested a price protection scheme modelled on the lines of the minimum support price (MSP). It said the Tea Board should undertake a detailed study to determine an equitable price-sharing ratio between small growers and factories. Small growers are facing the persistent challenge of poor price realisation, which is undermining the sector's sustainability, CISTA president Bijoy Gopal Chakraborty said. Small growers contribute more than 52 per cent to the country's tea production, and a proper price realisation mechanism should be identified so that livelihoods are sustained, he said. Chakraborty said the association has already submitted a detailed status paper to the Commerce Ministry in May 2023, outlining the structural bottlenecks faced by the sector, which is suffering from chronic price realisation challenges. He said the concept of minimum benchmark price should be replaced by a new methodology linked to the total sales value so that growers receive a fair and remunerative price. CISTA favoured the Sri Lankan model, under which surplus earnings over auction averages are shared equally between factories and growers. Proposing a price protection scheme for small growers, it said the average green leaf price currently ranges between ₹22 to ₹25 per kg, while the cost of production is hovering between ₹17 and ₹20 per kg. The yield on a modest margin is ₹5 per kg for the growers, it said. On the other side, agents typically charge ₹2 per kg, the CISTA said it is a big disincentive, and growers should be able to sell directly to factories. (Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
Time of India
09-07-2025
- Business
- Time of India
Stuck in Mum port for a mth, tea from Kol finally lands in Iran
1 2 Kolkata: Export of tea from Kolkata to Iran — in a limbo during the Iran-Israel conflict — has resumed following the announcement of ceasefire. About 50 containers carrying 1 million kg of orthodox Assam tea reached Iran's Bandar Abbas port this week. These tea consignments had been piling up at Navi Mumbai's Nhava Sheva port since the second week of June. Iran is the second-largest recipient of Indian tea after Russia, accounting for around 20% of India's tea exports. In 2024, tea exported to Iran from India was 31 million kg. Leading tea exporter Shah Brothers' chairman Sashi Kanta Shah expressed relief, saying, "About 200 tonnes of tea in our 10-container consignment had been stuck in Mumbai during the conflict. Now that the shipping route is open, we can finally see our tea in the Iranian market." You Can Also Check: Kolkata AQI | Weather in Kolkata | Bank Holidays in Kolkata | Public Holidays in Kolkata Confederation of Indian Small Tea Growers Associations president Bijoy Gopal Chakraborty said, "Tea market relies largely on exports. Orthodox tea grown in Assam and Dooars has a big market in Iran, and we look forward to a rise in demand."
