Shipments, freight crises loom over tea auctions
Delayed shipments have caused concern among the country’s tea industry that is seeing a direct impact as a result of this in terms of lower prices at the Colombo tea auction.
“Shipments are getting delayed by weeks,” Ceylon Tea Traders Association (CTTA) Chairman Jayantha Karunaratne said noting that since mid last month there are very few sailings between the US and Colombo port.
He pointed out that his own company was holding out a number of containers without shipping as a result of these delays and ships not turning up at the Colombo port. Mr. Karunaratne explained that with a severe increase in freight rates there has been a drop in the number of sailings from the Colombo port.
This concern is part of a larger global crisis among exporters and importers as vessels are being held up in ports around the globe.
Finally it will come down to prices, and from local tea exports when one cannot ship out, the demand for tea will go down and it will reflect at the Colombo auctions.
One of the reasons is the shipping out of goods and also the crop has gone up in production by about a slight increase compared with last year’s production levels, he said
Another cause for concern is the import controls placed on certain items like herbs and materials like metal caddies that are limited in stocks. Due to the import controls there is a cumbersome process involved in obtaining them for exporting the teas, Mr. Karunaratne pointed out.
There were 6.57 million kg of tea on offer this week at the Colombo Tea Auction with 2.86 million kg of Low Grown Main Grades and 2.21 million kg of High and Mid Grown Main Grades.
Low Growns met with less demand, but most like the select best BOP1s lost out in value; stylish liquoring OP1s held firm, while others decline in value.
There was a more general demand in the Ex-Estate catalogues, particularly BOPF. The high priced Western BOPFs were irregular; others gained by Rs.30-40 and more as the sake progressed. BOPFs gained by Rs.10-30; Uva BOPs irregularly lower by Rs.10-20. Best BOPFs moved up by Rs.30-40 others gained by Rs.10-20. High priced CTC PF1s were firm; some improved teas dearer by Rs.10-20-30.