New Delhi: Auction prices of tea shot up by 16% in the first seven months of 2008 on the back of rise in exports, though the volume of tea available for auctioning witnessed a fall in northern India and increased in the south.
According to the Tea Board, prices of tea at auctions have increased to Rs76.40 per kg till July, from Rs65.80 per kg in the year-ago period.
Similarly, auction prices in northern India have posted a 20% rise to Rs86.55 up in July while, in the southern part, prices have shot up by 14% to Rs59.23 against the same period last year.
However, tea volume at auctions in the northern region fell to 1.56 lakh kg till July from 1.64 lakh kg in the same period last year, while it rose to 92,426 kg in the southern part from 75,305 kg.
The rise in auction prices can be attributed to a 19% surge in exports that have put pressure on domestic prices. Also, shortfall in tea production in Kenya and better export prospects with Iraq have boosted India’s exports and, thereby, moved up auction prices, according to an industry expert.
Tea Board chairman Basudev Banerjee had said India is expected to export around 20 million kg of tea to Iraq this year.
Kenya is also likely to witness a decline of around 40 million kg in its tea production this year, he added.
In value terms, the shipments between January and July rose to Rs1,096 crore, against Rs910.27 crore in the year-ago period.