Rising Kenyan output may end India’s tea party

KOLKATA: Rising Kenyan tea production may spoil Indian tea exports in the coming months as the African nation is likely to give Indian tea a run for its money in the world markets. Kenya’s April tea production has been higher by almost 42 per cent compared with the same period last year, pushing prices down at the Mombasa auctions.

Kenya largely exports CTC black teas to two nations — Pakistan and Egypt. India too exports to these nations. Talking to ET, Sujit Patra, secretary, Indian Tea Association, said, “Kenyan production is up, which may become a concern for Indian tea exports. But it is early days for exports to pick up. It has to be seen how the world market reacts in the coming months. The demand for Indian tea is increasing in Iran, the US and Russia.”

In 2017, exports to Russia have increased to 47.56 million kg, from 44.62 million kg in 2016. Similarly, exports to Iran have increased by 23.72 per cent to 29.57 million kg in 2017, compared with 2016. Even exports of black tea to the USA, which is a ready-to-drink market, have risen to 14.16 million in 2017, compared with 13.97 million kg in 2016. The total tea exports from India in 2017 were to the tune of 251.91 million kg, and Indian tea exports in the first three months of 2018 had gone up 7.69 per cent over the corresponding period of 2017, though price realisation has fallen by 1 per cent.

“The drop in price realisation is not going to impact much. When bulk exports pick up for second flush teas, the realisation will automatically move up,” said Patra.

teabag--snip