Tea output set to fall by 120 m kg this year

KOLKATA: The Indian tea industry is heading towards a shortfall of 120 million kg this year. Lower domestic production, coupled with a drop in Kenyan output of 37 million kg, has already pushed up tea prices in India.

Global prices have also appreciated in the last four months. All these factors have pushed up the profitability of tea companies in the first quarter of the current fiscal year.

Tea producers say the deficit in the domestic market will be 120 million kg this year. This is despite the fact that the weather condition is generally good this year.

India had produced 960 million kg of tea last year and there was a production shortfall of nearly 30 million kg. The carryover deficit in 2010 was 60 million. In all, the deficit in 2010 was 90 million kg.

"With consumption growing at a rate of 3-3.5%, there is a need for an additional 30 million kg of tea this year to meet this demand. This means that there will be an overall deficit of 120 million kg this year," explained Aditya Khaitan, managing director of McLeod Russel India.

"Tea companies are expecting that FY12 will be a good year performance-wise. Tea prices are already on a firm note. The shortfall in Kenya by 37 million kg is also pushing up global tea prices and Indian tea exporters are leveraging this," said CS Bedi, managing director of Rossell India.

For instance, McLeod Russel's teas are being sold at a premium in India as well as in Mombasa auctions which have jacked up its net profit by 98% to Rs 37.33 crore in the first quarter of FY12 from Rs 18.85 crore in the first quarter of financial year 2011. "Our teas are fetching Rs 15 -16 more per kg compared to previous year. Teas grown in our Ugandan and Rwandan estates are fecthing 50-60 cents more per kg at the Mombasa auctions," said Khaitan.

AN Singh, managing director & chief executive officer of Goodricke Group, said: "The market sentiment is strong and teas are expected to fetch better prices. This will have an imp- act on the profitability of tea firms. However, one has to see whether the cost of production does not go up in the coming mo-nths. Export enquries are strong and tea companies are hoping to have better forex earnings."

The Economic Tmes

Small tea growers usher in winds of change in Assam

A green revolution is sweeping Assam, empowering many people for the first time and rejuvenating the state's economy. Small tea gardens now dot the landscape as more and more people turn their backyards into mini tea plantations.

It does not really matter if you have a small patch of vegetable garden to spare or a big mass of land.

According to the All Assam Small Tea Growers Association (AASTGA), the number of small tea growers has swelled to 65,000 in the last two decades. And it is on the rise.

Assam currently produces around 480 million kg of tea. Around 30 percent of this comes from small tea growers.

Lakhi Gogoi is one of the many who has his own tea garden - Rajashree Tea Estate - in the upper Assam district of Tinsukia.

'In 2008, my green tea leaf production touched 80,000 kg. In 2009, it rose to 81,000 and this year I am expecting it to touch 100,000. Tea business is good business,' Gogoi told IANS.

Although Gogoi worked in a well-known tea company earlier, he had no knowledge of the business.

'I am well accustomed to the knowhows of tea cultivation, spraying pesticides, pruning and plucking. It was a matter of time before I realized that if the big tea companies can grow these plants and reap such big benefits, so can I,' he said.

'After years of toying with the idea, I began my venture in 1996 on a small patch of land. Over the years, I scaled up my operations and now grow tea in 50 bighas of land,' Gogoi said.

Depending on the market conditions, the price of green tea leaves varies between Rs.12 and Rs.18 a kg.

Said an AASTGA official: 'By growing tea in underutilized uplands, small tea growers have brought in a green revolution in Assam by bringing in huge socio-economic changes.'

'More than 900,000 people are involved in the small tea growing business in Assam. Almost 250, 000 hectares of land is covered for such plantations. They contribute to 29 percent of the total tea produced by Assam, which is 14 percent of the total tea production of India,' the official added.

Even farmers in villages, who traditionally grew vegetables, are now opting for tea cultivation. 'Tea cultivation brings much higher profits and is a steady source of income,' said D. Bora, a farmer.

In a state where unemployment looms large, youth are the biggest beneficiaries.

Rajiv Sharma, 28, decided to try his hands in tea plantation two years ago. He started small -- growing tea bushes in the backyard of his house. And there has been no looking back since.

'My parents were initially sceptical and said tea production has always been the big companies' cup of tea. But I was willing to take the risk. I started small and now have the capacity to invest in more land for more plantations,' Sharma said.

Unlike the big tea companies like McLeod Russel India and Goodricke, small tea growers do not have their own factories. They sell their leaves either to the big firms or smaller private factories which in turn manufacture and market it under different brands.

One of the challenges that the small tea growers are facing is that of maintaining quality.

'Not all growers are aware of banned chemicals. All they seek for are strong pesticides which will kill the pests - thus making the wrong choice. As a result, this tea does not get a good price at tea auctions,' Sharma told IANS.

It is for this reason tea leaves of small growers are manufactured and branded differently from the main brands by the big tea companies. Nevertheless, almost 25 percent of the tea manufactured by the tea moghuls are from the small growers.

While the small tea growers are helping to change the socio-economic condition in Assam, they hardly get any help from the state government.

Minister of State for Commerce and Industry Jyotiraditya Scindia's recent announcement of a special scheme to provide financial assistance to the community has, however, given them some hope.

'If the government is seriously thinking of helping us, it will be great. We are after all an unorganized sector. Let's just hope it is not another empty promise,' said Gogoi. 

Source: IANS

Small tea growers demand easy cash

Siliguri, Dec. 9: Small tea growers in India will hold their two-day annual general meeting in Jalpaiguri and demand that funds should be made easily available for them.

Bijoygopal Chakraborty, the vice-president of the Confederation of Indian Small Tea Growers’ Associations (Cista), said in Jalpaiguri today that the meeting would be held on December 14 and 15 and farmers from all tea-producing states in the country and special invitees from Nepal and Bangladesh would be present.

As Union minister of state for commerce and power Jairam Ramesh and Tea Board of India chairman Basudeb Banerjee are scheduled to attend the inaugural function, the organisers will use the forum to raise a number of issues the growers face and to place some demands.

Chakraborty said the farmers would demand the formulation of a policy to determine the floor price of tealeaves so that the growers would not incur losses. A separate directorate for small growers, establishment of financial link with banks and other lending institutions to ensure availability of working capital to growers and simplification of the process to get them registered with the tea board are the other demands.

“We will also ask the government to introduce plantation credit cards which will ensure funds and fertilisers,” said Chakraborty. He also wanted the representatives of Cista to be included in the policy making process in the commerce ministry or the tea board. He said there should be a special drive to open mini factories for small growers.

Growers from Assam, Tamil Nadu, Kerala, West Bengal, Himachal Pradesh, Tripura, Bihar and Arunachal Pradesh will be present at the meeting. They will also attend a seminar on “challenges for strengthening small tea growers’ society or self-help groups as business units”.

Sources said there were around 2.5 lakh small growers across the country, contributing 25 per cent of India’s total tea production.

“We will also celebrate International Tea Day on December 15 at Islampur in North Dinajpur. A number of Bengal ministers will be present at the programme,” said Chakraborty.

“The small growers will organise a rally, street plays, puppet show and traditional dances as part of a campaign to promote the beverage,” he added.

Tea workshops

The Goodricke Group Limited has decided to conduct workshops on tea cultivation for small growers of Jalpaiguri district.

The group that has 27 gardens across the country, 12 of them being in the Dooars, has decided to hold such trainings to ensure that the tealeaves supplied by the small growers to the company are of high quality.

Vivekananda Mondal, who is associated with Goodricke, said the first workshop would be held in the group’s Denguajhar Tea Estate, located on the outskirts of Jalpaiguri town, on November 29.

At the workshop, growers would be taught scientific methods of pruning of tealeaves, use of manure and fertilisers.

“We will have officials from the tea board and experts of the group to speak at the workshop which, we feel, will be attended by 100-150 growers,” said Mondal.

Small growers on Amul mission

Siliguri, Nov. 19: Small tea growers of north Bengal are on a visit to Gujarat to study the success of Amul and replicate the model in their sector.

“We had been toying with the idea to visit Amul to witness the activities right from grassroots to the top level,” Bijoygopal Chakraborty, the vice-president of the Confederation of Small Tea Growers’ Associations of India and a grower of north Bengal, said over phone from Gujarat. “The opportunity finally came and we reached here yesterday to study how milk producers, who form the lowest rung in Amul, could taste success through a concerted effort and planning.”

The three-day visit to Gujarat was organised in association with the National Dairy Development Board.

“Self-help groups are mushrooming in our sector on a regular basis,” said Debasish Pal, another grower from north Bengal in the delegation. “Seeing that more growers are joining, we are contemplating on a plan to reach the consumer directly with our branded tea like what Amul is doing with its versatile range of products.”

The eight-member delegation has members from other tea producing states as well.

“If milk producers can unite, work on an accumulated capital along with financial assistance and take the help of technology to become a model cooperative movement in the country, why cannot the small tea growers, whose number is going up everyday, replicate the process?” Pal asked.

With the research organisations in India busy in working on value added products like specially flavoured tea, tablets, drink, chocolates and biscuits, the growers of the country are keeping their fingers crossed. “In case we take the strategy adopted by founders of Amul and get success, the value added products can be merchandised,” Chakraborty said.

During their visit to Gujarat, the small growers met with officials, milk producers and other stakeholders of Amul. “We witnessed how milk is accumulated and processed to make different products. Also, we got ideas how the producers are paid, what other facilities they enjoy, how the entire chain is maintained,” said a member of the delegation.

Small tea growers want more BLFs in north Bengal

SILIGURI, Oct. 29: The small tea growers of north Bengal have demanded an immediate annulment of the state government's prohibitory order on setting up of new Brought Leaf Factories (BLF) in the region.

According to the small tea growers, the absence of ‘adequate’ number of BLF's was hitting the small gardens across the region, as many a times there are no takers of the green leaves produced.

“In the past seven years, there have been a considerable rise in the number of small tea growers across north Bengal, while the prohibition on setting up new BLFs since 2001 is preventing the corresponding increase in the number Brought Leaf Factories over here.

As a result of this, the supply of green leaves is higher than what the existing BLFs can absorb. Hence, the small growers are fetching a lesser price for their produce,” said Mr Sanjit Paul, convener of the Small Tea Gardens Forum (STGF) affiliated to the Indian Tea Planters’ Association (ITPA).

As per the figures provided by him, early this month a kg of green leaves was fetching something around Rs 5.50 to Rs 6, which has now risen a little higher to Rs 8.50 per kg.

“Considering the higher price that ‘made tea’ is fetching in the auctions this season, these prices are very low. Unless the state government permits more BLFs to come up, the small growers will continue to be exploited,” Mr Paul said.
The Small Tea Gardens Forum has recently sent a memorandum to the principal secretary of the state commerce and industries department urging the annulment of the prohibitory order on the establishment of new BLFs in the region.

The bar on new BLFs was promulgated to ensure that the existing BLFs and tea estates would run as per their capacity. As of now, there are nearly 78 BLFs in north Bengal as opposed to the 15,000 small tea growers across the region.

More tea benefits to small tea growers

New Delhi: Small tea growers in the country may soon get benefits enjoyed by medium and large tea garden owners .

Sources told Business Line that the Government and the Tea Board have already put in place a slew of measures to help the small tea growers with less than 25 acres. These include, among others, subsidy and grant in aid for their various developmental activities such as new planting, replanting, rejuvenation, pruning and infilling the vacancies, creation of irrigation facility, and organising them into self-help groups (SHGs).
Subsidy

Sources said Rs 53.36 crore has been disbursed under the ongoing schemes which is inclusive of Rs 20.85 crore disbursed as price subsidy. Though the aggregate production from small growers accounts for only 20 per cent of the total production, the financial assistance extended by the Tea Board during the last three years (2004-05 to 2006-07) of the 10th Plan works out to 27 per cent of the total assistance given to the tea industry, estimated at Rs 198.60 crore.
Price sharing

Sources said that the implementation of a price sharing formula with effect from April 1, 2004 was primarily to ensure that the small tea growers get a fair share of the price .

While calculating the actual price for the green leaf, the outturn percentage is also taken into account. The outturn percentages applicable to Tamil Nadu is 23 per cent, Himachal Pradesh and Uttaranchal it is 26.40 per cent and for the rest of India it is 21.50 per cent.

Sources said that in some parts of the country particularly in North Bengal and South India, the bought leaf factories have not been adhering to the directives issued by the Board. All such factories in North Bengal have been identified and notices have been served on them with a warning that stern action would be taken if they fail to follow the directives.
CISTA launched

the Minister of State for Commerce, Mr Jairam Ramesh, said that he has launched the Confederation of Indian Small Tea Grower Association (CISTA) in Elappara in Kerala on December 15. Mr Ramesh said that he saw them as a great social force since they signify first-generation local entrepreneurship in the industry.

He said small growers accounted for 25 per cent of the country’s tea production with 39 per cent in Assam, 34 per cent in Tamil Nadu, 24 per cent in North Bengal and 10 per cent in Kerala. Mr Ramesh said the Department was engaged in ensuring how “we can give CISTA representation on the Tea Board”.

He said that he has written to State Chief Ministers about giving the small growers pattas or some sort of possession certificates so that they could avail of the schemes and loans . Only 10 per cent of them are registered with the Tea Board. He said the Board will fund a complete census of small tea growers which could be undertaken by the State Governments.

Source: Business Line

Small tea growers demand

Small tea growers of north Bengal have threatened to start a movement after the Pujas, demanding that the state government speed up the process of issuing no-objection certificates (NOCs) to their plantations.

Most of the plantations were created by converting farmland or fallow land and the government needs to give a no objection to this change. The NOCs, in turn, will help the growers get registered with the tea board and avail of its financial assistance schemes.

“We will soon write to state government officials and ministers on the matter,” said Bijoygopal Chakraborty, the vice-chairman of the United Forum of Small Tea Growers’ Associations.

There are around 15,000 small growers in the region and they produce about 25 per cent of the state’s total yield. “Only 4,500 of them have NOCs for their plantations from the land and land reforms department,” said Chakraborty.

Currently, only 2,500 growers are registered with the tea board. The others are missing out on Rs 24,000 per year per grower paid by the board as subsidy, said forum chairman Partha Pratim Pal. More than 3,000 applications for NOCs are lying with the land and land reforms department.

Source: The Telegraph

Tea Board to conduct program for small tea growers

The Tea Board of India will for the first time conduct a training program for the 15,000-odd small tea growers of the state from September 11.

The program, to be funded by the board, will be conducted with the help of Uttarbanga Krishi Vishwavidyalaya (UBKV) authorities based at Pundibari in Cooch Behar. The short-listed growers are from Jalpaiguri, Darjeeling and North Dinajpur districts.

“The board has lived up to our expectations,” said Bijoygopal Chakraborty, the joint secretary of the Jalpaiguri Zilla Kshudra Cha Chashi Samiti. “We hope that the training starting with 21 small growers in the region will be a regular affair aimed at training the growers, most of whom lack proper knowledge to produce quality tealeaves,” he said.

According to Himadri Bhattacharya, the training coordinator and head of the plantation crops and processing department in UBKV, the training will be held at Krishi Vigyan Kendra at Chopra in North Dinajpur. The participants will stay there and attend both the three-hour practical and two-hour theoretical classes everyday, he said.

“The medium of instruction will be Bengali and adequate study material will be supplied to the trainees,” Bhattacharya added.

The list of subjects for the training includes plantation material, soil and climatic factors, nursery maintenance, land preparation, nurturing young tea bushes, shade tree and weed management.

Fertility management, drainage and spraying, irrigation, plucking and leaf handling, pest management, record keeping, entrepreneurship development, schemes of tea board, bank and other enterprises also figure on the syllabus.

Source: The Telegraph