Bad roads and a broken bridge affect tea distribution

Over 50 lakh kg of tea ready for distribution is stuck at warehouses in Siliguri after bad roads in Bihar and the broken Bailey bridge in Raiganj disrupted traffic in the region.

S.K. Saria, chairman of Siliguri Tea Auction Committee (Stac), said the situation is likely to have a spiralling effect, ultimately hitting the planters and workers at a time when the industry is trying to cope with the twin effects of low production and price.

“About 50 lakh kg tea auctioned off in the past three weekly sales (Sales 33, 34 and 35) is lying idle in the warehouses,” Saria said. “This means about Rs 40 crore is stuck up at a single point of the supply chain.”

Following requests from buyers to defer tomorrow’s auction at Siliguri Tea Auction Centre, the Stac sales advisory committee held a meeting today. “However, we decided not to let the auction be affected for it will hit the sellers hard,” Saria said. “For the sake of the buyers, the seller members have agreed to increase the ‘prompt’ by two days.”

Prompt in industry terminology stands for the number of days by which the buyers are supposed to pay for the stocks bought at the auction. According to Stac rules, a “prompt” of 13 working days is granted to a buyer for each sale. “The buyers will now get a respite of two days each for the last three sales as well as tomorrow’s sale.”

Saria said Stac has also decided to submit a memorandum to the government on the situation.

Shankar Agarwal, general secretary of Siliguri Road Transporters’ Association, said tea movement has almost come to a standstill. “Since the last one month, the Bihar floods and bad roads resulting out of it have caused a near total halt of movement of trucks to and from north India through Bihar (mainly the seven-eight km stretch in Naugachia),” he said.

“On an average, 100 truckloads of tea move out of Siliguri daily, but now because of the road disruption not a single vehicle is being dispatched,” Agarwal said.

S.K. Bhattacharya, the secretary of Siliguri Tea Traders’ Association, said the buyers were at a loss. “If the primary buyers are unable to deliver tea to up-country buyers, they will not receive payments. On the other hand, they will have to make the necessary payments to the sellers within the prompt period. However, the relaxation in prompt has brought some relief.”

Source: The Telegraph