Dilmah Tea founder honoured by World Association of Chefs’ Societies Lifetime Achievement Award

Dilmah Founder Merrill J Fernando receiving the Lifetime Achievement Award from WorldChefs President Thomas Gugler (far right). Also pictured: Dilmah Tea CEO Dilhan 

C Fernando, World Association of Chefs’ Societies Managing Director Ragnar Fridriksson


Sri Lankan tea pioneer Merrill J. Fernando was honoured at the WorldChefs Congress 2018 with the prestigious Lifetime Achievement Award, for his extraordinary passion and commitment to tea, and for his unique philosophy of making business a matter of human service. The Award was presented by WorldChefs President Thomas Gugler at the biennial global Congress which took place in Kuala Lumpur last week, with the participation of over 1,000 chefs representing 100 Chefs’ Societies from around the world. 

Merrill J. Fernando is recognised for his commitment to tea, especially the harsh early years when he fought for value addition at source, and against the colonial economic system that saw his country’s prized crop sold at auction in London. When eventually he succeeded, his struggle against the interests of big businesses that dominate the global tea industry had taken nearly 40 years. When his brand Dilmah was born in 1988, it was a victory for farmers around the world as it was the first time tea, coffee or cocoa was offered grown, picked, packed and branded at source by a farmer.  The benefit of that accrues to tea drinkers around the world, and to workers and their families alike, for tea that is packed at source is fresh and therefore richer in flavour and natural antioxidant goodness. A farmer’s desire is for quality, fundamentally different to the objective of a trader who buys and sells tea purely for profit from any source to a buyer in any market, and that was so for Merrill J. Fernando, whose words, ‘I devoted my life to tea,’ resonate powerfully in this time of commodisation and compromise. His tea was named after his sons Dilhan and Malik, and underlined by an uncompromising commitment to quality, traditional manufacture, freshness and single origin tea (www.dilmahtea.com).  Less well known is Merrill J. Fernando’s commitment to family values and their embodiment in his brand through the philosophy of making business a matter of human service. That principle requires each of the Dilmah Tea, plantation, packaging and ancillary businesses to contribute a minimum 10% of their pre-tax profits to the Merrill J. Fernando Charitable Foundation (www.mjffoundation.org) which utilises these funds to empower youth, and women in difficult economic and social circumstances, children with special needs, communities that are economically marginalised, and the environment. 

Amongst the outcomes of the Dilmah philosophy is the Empower Culinary School, a WorldChefs approved training school that offers culinary training free of charge to young women and men who are economically, socially or otherwise disadvantaged. Amongst those that have benefited from the Empower School are youth with cerebral palsy and Downs syndrome, amongst other typical persons. The second Empower Culinary & Hospitality School will open in August this year at the MJF Centre East, the largest privately funded charitable initiative in Sri Lanka, which is designed to serve differently abled children, youth, women and communities that are economically disadvantaged through the principle of empowerment with dignity.

 

Daily FT, 17th July 2018.

Navin discusses plantation issues and development with ADB

Officials of the Asian Development Bank met Minister of Plantation Industries Navin Dissanayake and informed him of their commitment to fund the rehabilitation and development of the tea sector of the plantation industry. 

The Minister informed the delegation that the tea sector was badly in need of capital to replacing aging tea bushes with new and vibrant cultivars in order to increase our production to 400 to 450 million kg of tea per year. Currently the country as a whole produces about 300 million kg of tea.

Ceylon Tea is considered the Champaign of teas and still attracts a premium in the world market. There is a growing demand for these teas and new markets are opening up and the demand is getting greater for quality teas. In order to manufacture this type of tea, we need to find solutions to the labour shortage and one area which needs to be addressed is mechanisation. Plucking machines have now been developed and could provide quality leaf to the factory if the technicians are trained on the proper technics of using these machines. We also need to develop our factories to meet the demand of an increase in production. 

The ADB officials told the minister that they had done a thorough study with the assistance of officials of the Ministry of Plantation Industries and have identified areas where ADB funding will be available for the development of the tea sector. 

In the Regional Plantation Companies, they will assist in undertaking replanting of 2% of the acreage every year. They will also support an infilling program where vacancies in productive tea fields will be filled. The also intend supporting efforts to overcome climate change and particularly in the Uva District will support drip irrigation schemes to mitigate the prolonged droughts that this district has been experiencing.

In the small holder sector, similar loans will be provided to them but in case of small holders who have less than one acre of land, they will help them by providing assistance for infilling rather than replanting. The small holder relies income he/she received from ½ acre or 1 acre cannot afford to sustain themselves economically if they uproot the tea and replant, as it will take about five years before they can commence obtaining an income from the newly planted tea. Infilling on the other hand is the answer to increased production. 

The ADB has also considered the shortage of workers on both RPC estates and in the Tea Small Holder sector and have undertaken to develop a scheme that will provide motorised plucking machines, pruning machines and other motorised devices that will eliminate the need for the heavy dependence on labour. 

The ADB program is set to commence in 2019.

 

Daily Ft, 10th July 2018.

Craighead Estate achieves all time record price

Craighead Estate, Udahentenna, achieved an all-time record price of Rs. 1300 per kg for an OP1 grade in the Western Medium category, at the weekly tea auctions held on 10 July. This line of teas was purchased by M/s. St Clair Teas Ltd and marketed by M/s. Forbes & Walker Tea Brokers Ltd. 

 

Craighead is reputed for producing high quality, award winning teas, and has the distinction of achieving the following all time record prices in the Western Medium Elevation category: FBOPF1 at Rs. 1100; FBOP at Rs. 1800; BOP1 at Rs. 1360; and OP1 at Rs. 1300.

 

Craighead is situated in Nawalapitiya in the Kandy planting district, at an elevation of 800 m above sea level, and was originally built in 1914. This factory has an annual capacity of 550,000 kgs of made tea, and is certified under UTZ, Ethical Tea Partnership and ISO 22000:2005 Management System Certified for Manufacture of Black Tea. 

 

Craighead is managed by Abhishek Samarakoon, assisted by factory manager K. G. Kudabanda, and comes under the purview of Plantation Director Chaminda Guneratna for Kahawatte Plantations PLC, who are the managing agents for this estate.

 

Daily FT, 12th July 2018.

Tea Traders Chief cries foul over heavy taxation; delay in glyphosate relief

The Ceylon Tea Traders Association recently pointed out that the new revised high levels of taxation introduced to investors in the plantation sector will demotivate entrepreneurs as heavy taxation will reduce profits and leave very little accumulation of funds for re-investments.

 

The association’s reappointed Chairman Anslem Perera addressing at the 124th Annual General Meeting (AGM) urged National Policies and Economic Affairs State Minister Dr. Harsha de Silva to address this issue that has been thrust upon them by the new taxation system that will seriously effect investment in the tea trade.

 

“This is an era where rural employment is only possible by offering higher wages, better status and good working conditions to the young workers.

The burden of heavy taxes will leave very little room for reasonably attractive wages to motivate village youth to stay back in the village. If not, they will naturally look for greener pastures in the big cities or overseas,” he added.

 

Noting that specialised warehousing was on a concessionary tax rate in the past, he said that this has now been brought into the same level as cooperate taxes, which will demotivate investors in creating much needed state of the art warehouses to meet international food standard.

 

He also said that despite announcing the lift on glyphosate ban in April, lift after two months it has still not been gazetted and regularized.

 

“It is ironic to note that three years ago the ban was effective from the very next day after the announcement, but de-banning of same takes many months to be implemented – this is the beauty of bureaucracy at its highest,” he pointed out.

 

He said the latest negative development as a consequence of the ban on glyphosate brought in greater disaster when Japan announced that they were imposing higher maximum residue levels for Hexaconazole and MCPA, while European Authorities have tightened on Diuron.

 

According to him shipments in Japan were held back and some returned as the MRL levels that were set made conformity almost unachievable. 

 

The crisis has developed into international proportions. “Japan has already threatened total suspension of Ceylon Tea if the ban on glyphosate is not lifted immediately. We will then face an economic disaster,” he cautioned.

 

It has been revealed that the proposed revisions relating to the MRLs of some chemicals had been advised as way back as year 2017 by the Japanese authorities to the Embassy of Sri Lanka in Japan. This was well in advance of their introduction which would have given us adequate time for the submission of an appeal at a comfortable higher level.

 

“The embassy in 2017, perhaps due to an oversight, failed in their duty to transmit this information to the Tea Board and TRI in time. This naturally made the Japanese authorities place default higher levels for MRLs.

 

Once again a disastrous bureaucratic breakdown of a different dimension,” Perera said.

 

He asserted that the TRI is now the process of organising the required field trials to determine the revised residues for MRLs. “Reliable sources have informed us that Japanese Authorities are certainly in favour of revising the MRLs of Hexacionazole and MCPA based on TRI’s field trial data,” he quipped.

 

The imprudence of our authorities has already benefitted our competitors, as replacements for rejected consignments are being purchased from them, Perera lamented.

 

According to him around 10 million kilos of fine quality teas are purchased annually by Japan. “It may be argued that this is only a fraction of our 300million kilo annual production. It must be realised that purchasing this

 

10 million kg of premium grade Ceylon tea with a value of over 50 million dollars, creates great competition at the Colombo Tea Auction. The bidding encompasses a much larger volume of tea to at least 5 times the quantum that is purchased. This biding bolsters prices at the auction by as much as Rs. 150 – 200 per kilo.”

 

In the event of a total ban from Japan he warned that prices will be impacted seriously and lower auction prices will result in serious revenue losses to the entire plantation industry impacting the livelihood of over two million individuals involved in the industry.

 

“This will be a needless disaster inflicted upon the Tea Industry and consequent financial, commercial and credibility losses forced upon us will certainly be irrevocable,” he stressed.

 

He reiterate that the RPCs must act with trust and responsibility keeping to their promise as their fine quality teas are sort after by the Japanese buyers. 

 

“The prices that your teas fetch when they are free of MRLs, I am sure are attractive enough to keep away from the use of weedicides. Please do not let exporters and Japanese buyers be heavily burdened by these heavy expenses and lose confidence in you” he added.

 

Another disaster in the making Perera highlighted as the seriously suspected adulteration of tea with unauthorised additives such as glucose and sugar. Producers must act with caution and responsibility. 

 

“Tea is a food product, not a cosmetic item!” he added.

 

Noting Short term profits are short lived, he said those who dwell in such practices will soon suffer adverse consequences.

 

“Authorities must crack down on them and bring them to book. Ceylon Tea has a reputation of being the cleanest tea in the world. Don’t let us loose this. Once lost, regaining this status will not be an easy task,” he stated.

 

Further on the challenges that the industry faces Perera noted that six of the larger Middle Eastern buyers of Ceylon Tea continue to face turmoil.

 

“In consequence demand is further reduced. The Russian and Turkish de-valuations in their currencies have resulted in weaker buying power. Sanctions on Russia and Iran too have created practical payment issues for export remittances. Volatility in the Middle Eastern region continues. Syria a previously a lucrative market is now in shambles. The EU and US markets continue to face financial challenges,” he said.

 

In terms of weather he said the favourable conditions prevailed during the second half of the year and the consequent improved cropping helped production to catch up and surpass the poor results of the preceding year.

 

The notion of computerising the Colombo Tea Auction has been on the CTTA’s agenda for almost two decades. “I would be remiss if I did not mention here, Minister, and express to you the profound gratitude of the Colombo Tea Traders’ Association, that it was your pioneering vision, conceived nearly 18 years ago of an Integrated Computer System for Automation of Auction Procedures of the Colombo Tea Auction, that first drew the attention of the Tea Trade to this progressive initiative.

 

He said the concept of ‘Computerisation of the entire Value Chain of the Tea Industry was recently proposed by the immediate past Chairman of the Tea Board. This met with the unanimous concurrence of the CTTA Committee and a mechanism for funding it is being examined.

 

Sri Lanka’s tea industry should capitalise on China and India

Ceylon Tea Traders Association Chairman Anslem Perera said Sri Lanka’s tea industry should capitalise on China and India that are proving to be potential large markets with their rapidly increasing populations and their ever growing thirst for tea.

 

“As we know their own production cannot meet their growing domestic requirements. Hence we should actively nurture these markets,” he told addressing at the 124th AGM last Friday.

 

He insisted the Tea Board with the promotion and marketing committee to direct their attention to disbursing the already accumulated promotion fund for international initiatives in an aggressive and objective manner to capture these very important markets.

 

“If we do not move forward with our promotion efforts overcoming bureaucracy, we will allow our competitors to have a lead over us in these new markets,” Perera added.

 

He said the tea industry has failed to keep abreast of technological advances in its value chain though I hasten to add, not through the lack of trying.

 

Daily Ft , 02nd July 2018

Harsha calls on tea stakeholders to compromise to revitalise industry

 

 

National Policies and Economic Affairs State Minister Dr. Harsha de Silva

 


  • Insists not all woes can be pinned at the hands of the State or the wider economy, industry must also take responsibility for some of these issues
  • Says the route of extreme caution; of unwillingness to try new things of fearing disruptive business practices, too myopic to see positives of different models of development has doomed industry to face ever-mounting troubles
  • Urges industry to reconsider qualities of facing adversity with ingenuity and experiment with diversification 
  • Outlines need to focus and investment in R&D; says it’s a shame Govt. and private sector hasn’t adequately support research into this important industry
  • Suggests plucking and production process to be modernised, conduct better marketing of the Ceylon Tea brand, to automate Colombo Tea Auction
  • Admits the Governments have let down tea industry with inconsistent, non-scientific policy-making
  • Calls on the Tea Board of Sri Lanka to act as an effective regulatory agent, as the quality of doesn’t get tainted by accusations of corruption and favouritism
  • Affirms Sri Lankan tea is losing markets as the industry has become over-reliant on a few volatile buyers in the Middle East and Russia
  • Highlights insufficient production, poor marketing, focus on wrong products as possible reasons for current troubles

 

By Charumini de Silva 

 

In a fresh attempt to revitalise and take Sri Lankan brew to next great heights, National Policies and Economic Affairs State Minister Dr. Harsha de Silva called on the tea industry to come to a compromise with innovative solutions, diversifications and plug into global supply chain; cautioning that the procrastination will be immensely dangerous to the Ceylon Tea brand and to country’s tea trade as a whole.  

 

Addressing at the 124th Annual General Meeting (AGM) of the Ceylon Tea Traders Association in Colombo last Friday the State Minister said that for decades the industry has tried the route of extreme caution; of unwillingness to try new things of fearing disruptive business practices, which has failed the country, tea producers, exporters and many people who could be working in a thriving industry instead of one that is treading water. 

 

“I am not here to tell you which model and path to choose; I am here to appeal to you, as an industry; to come to some kind of consensus on how to take Sri Lankan tea to its next great heights. This is not the attitude that gave birth to the Sri Lankan tea industry. The Sri Lankan tea industry and the Ceylon Tea brand are both descended from people who faced adversity with ingenuity, and were not afraid to experiment with diversification. For there to be a future of Sri Lankan tea, all stakeholders in this room will have to exhibit those qualities yet again,” he stressed.
 
 
 While the Government must certainly play its part in taking Sri Lankan industries towards sustainable futures, Dr.de Silva however asserted that the future of our tea industry is something that transcends politics and parties. 
 
The State Minister highlighted three sets of challenges Sri Lanka’s tea industry is faced at present stemming from the Government, from the economy and within the industry. 
 
Pointing out not all woes can be pinned at the hands of the State or the wider economy, he said the industry must also take responsibility for some of these issues. 
 
“What does everyone agree on? The Sri Lankan tea industry is losing ground to competitor countries, and sharply needs revitalisation and rescue. What do they disagree on? How to fix it. What do you need? The capacity to consider the other side’s point of view and reach a level of compromise about how to take the tea industry forward,” he stated. The State Minister said an industry which is at each other’s throats and too myopic and blinkered to see the positives of different models of development, is doomed to face ever-mounting troubles.
 
To face the future and to revitalise the tea industry, he urged the industry to reconsider qualities of facing adversity with ingenuity and experiment with diversification which once saved Sri Lanka’s planters and could do so yet again. 
 
 
 
“We need more focus and investment in research and development (R&D). It is a shame that the Government and the private sector have not adequately supported research into this important industry. Science graduates should be thronging to conduct research in this industry, instead they are sprinting overseas for lack of job opportunities,” he added. 
 
He suggested plucking and production process should be modernised via mechanisation or different harvesting systems such as out-grower systems as well as better marketing of the “Ceylon Tea” brand by using the funds collected through the Tea Promotion Levy.
 
 
In terms of post-production he outlined automating the Colombo Tea Auction. “Years ago, I was involved in a study/proposal for an Integrated Computer System for Automation of Auction Procedures of the Colombo Tea Auction. This could enable each tea offered for sale through the Auction to be monitored from the point of cataloguing until settlement of payment and simplify export documentation, curtail costs, and increase transparency and efficiency throughout the value chain.”
 
He acknowledged that both the present Government and successive governments in a number of ways has let down this important industry with failures of inconsistent and non-scientific policy-making. 
 
Exemplified by the glyphosate ban and its complicated fall out the Minister insisted that the Government must strive to reduce these uncertainties by making decisions based on scientific evidence, research and careful weighing of options, noting that once a good decision is made, barring new evidence, they must stick to those policies. 
 
 
 
 
 
 
“Many in the industry are hesitant to diversify into crops like palm oil because the Government line on whether it supports palm oil is unclear,” he added. 
 
Dr.de Silva also called on the Tea Board of Sri Lanka to act as a more effective regulatory agent to improve the governing environment around tea. 
 
“Last year, 53 factories were investigated and named as adulterating tea with sugar dust. These ongoing investigations must be completed quickly, and fairly. When factories are not abiding by the rules and regulations, those factories must be shut down or suspended, not given leeway because they know the right people and can pull the correct strings. It is crucial that the caretaker of the quality of tea in Sri Lanka does not get tainted by accusations of corruption and favouritism,” he emphasised.
 
In terms of the economy, he said that at home or abroad, the economy in which we produce and sell tea today is drastically different to what it was a couple of decades ago.
 
 
“While at home the tea industry faces factor market limitations such as land and labour as well as environmental threats to our resources; abroad, we combat the rise of competing suppliers that are buoyed by factors like cheaper labour, more land availability, and fewer import restrictions,” he said.
 
Considering domestic and external threats together, the State Minster said it was clear that Sri Lankan tea is losing markets as the industry has become over-reliant on a few volatile buyers in the Middle East and Russia and called it as a the main pitfall plaguing Sri Lankan tea. Referring to statistics from Harvard Center for International Development (CID) Atlas he noted that Sri Lanka previously supplied the majority of their tea, but in 2016 made up only 3.04% of UK’s tea imports, and 2.13% of Pakistan’s, whereas Kenya in 2016 supplied 47.12% of the UK’s tea, and a whopping 60.05% of Pakistan’s. 
 
Dr. de Silva highlighted insufficient production, poor marketing and continuing to focus on the wrong products were the remaining possible reasons for current troubles in tea industry.
 
 
Daily Ft, 02nd July 2018.

Tug of war between stakeholders limits tea industry modifications

National Policies and Economic Affairs State Minister Dr. Harsha de Silva  (second from left) smiles as Colombo Tea Traders Association Chairman Anselm Perera addresses the AGM on Friday. Others from left are Colombo Tea Traders Association Vice Chairman Jayantha Karunaratne, Tea Board Chairman Lucille Wijewardane and Colombo Tea Traders Association Vice Chairman Paani Dias - Pic by Sameera Wijesinghe

 

Harsha expresses confidence that Sri Lanka can integrate into global supply chains while protecting Ceylon Tea brand, tea production industry

Highlights importance of extremely thorough and effective regulatory environment, law enforcement and security measures to enforce rules of separation of Ceylon Tea with cheaper imports

Suggests setting up tea center as a bonded, exclusive warehouse zone

Despite all in the tea industry seeing diversification as a positive, National Policies and Economic Affairs State Minister Dr. Harsha de Silva said the tug of war between the two sides of stakeholders was continuing with them unable to agree on the appropriate means of modification as the “endgames” were not mutually exclusive.

 

“One side of the debate is that diversification should take place under the Ceylon Tea umbrella and the other side says diversification should take place via integration into global supply chains. As they see their motives and paths as completely distinct, the two sides have not been able to get through to each other,” he said while addressing the 124th Annual General Meeting (AGM) of the Ceylon Tea Traders Association last Friday.

 

He said the endgame of one side was to protect the ‘Ceylon Tea’ brand in order to protect the Sri Lanka tea production industry, while the other side’s endgame is to expand opportunities for the Sri Lanka tea industry and the wider national economy.

 

 

 

“Why have these sides been unable to get through to each other? Because they see their motives and paths as completely distinct. Side one fears that unscrupulous exporters would mix lower quality imports with local tea, slap on the ‘Ceylon Tea’ label and thereby ruin this famous brand name. Side two casually dismisses these fears as those of privileged protectionists — but actually, these ‘endgames’ are not mutually exclusive,” he added. 

 

The State Minister expressed confidence that Sri Lanka could integrate into global supply chains while protecting the Ceylon Tea brand and Sri Lanka’s tea production industry, and suggested setting up a tea center as a bonded, exclusive warehouse zone. 

 

 

 

“Envision it is as an offshore zone. Ceylon Tea could go into the zone, but any tea that comes out of the zone would be ‘Packaged in Sri Lanka’ instead. If this seems impractical, consider banks run FCBO operations completely separately from their domestic operations,” he stated.

 

However, because people may try to cheat and adulterate Ceylon Tea with cheaper imports and still pass it off as Ceylon Tea, Dr. de Silva highlighted the importance of an extremely thorough and effective regulatory environment, law enforcement and security measures to enforce the rules of separation.

 

He also noted that this may even help protect the ‘Ceylon Tea’ brand, as most of Sri Lankan tea was already exported bulk and then ended up in multi-origin blends in those countries, resulting in no way to confirm whether they were selling it as ‘pure’ Ceylon or not.  

 

According to him, Russia allows tea boxed in Russia to be labeled ‘Ceylon Tea’ if it has at least 51% Ceylon Tea. 

 

The State Minister said that if the industry did not come to a consensus and act fast someone else would do it in the same way the Dubai Tea Trading Centre was done. 

He pointed that a 260,000 square foot blending, packaging and trading center built in 2005 handled 10.6 million kilogrammes of tea in 2010. 

 

“This has made Dubai a major tea hub, even with no expertise in tea production. Have we let them steal the rug from under us? We have the expertise and the resources. It is high time we all act on this. Our own major companies may eventually move and set up elsewhere (or already are), at massive cost to our economy. These developments will be immensely dangerous to the Ceylon Tea brand and the Sri Lankan tea industry as a whole,” he emphasised.  


Daily Ft, 02nd July 2018.

Kelani Estate surpasses own record yet again!

Kelani Tea Factory achieved an all-time record price of Rs. 1,000 per kg for a Low Grown BOPFSp grade surpassing its previous record of Rs. 980 at the weekly tea auctions held on 26 June. This is the third consecutive week Kelani has bettered its own record and established a new record. This line of tea was purchased by Mabroc Teas Ltd. and was marketed by M/s., Forbes & Walker Tea Brokers Ltd.

 

Kelani Tea Factory is situated in Yatiyanthotta in the Sabaragamuwa Province at an elevation of 139 metres above sea level. This factory has an annual production of approximately half a million kilos of made tea per annum and is certified under Rain Forrest Alliance, ISO22000, HACCP, CQC and Ethical Tea Partnership. 

 

This estate is managed by Eranda Welikala and comes under the purview of Kelani Valley Plantations Plc. 

 

Daily Ft, 29th June 2018.

Alma and Kelani estates establish new records


 

 

 

Alma and Kelani estates established new record prices at the weekly tea auctions held on Tuesday (12 June).

 

Alma estate established a new all-time record price of Rs. 840 per kg for a BOP1 grade in the Udapussellawa elevational category. This invoice was purchased by Basilur Tea Exports Ltd.

 

Alma Estate is situated in Kandapola, at an elevation of 1450m above sea level, and has a production capacity of 600,000kg of made tea per annum. This facility is managed by Nuwara Eliya Valley Plantations Director Chula De Alwis under the purview of Sesame Senhora Tea Ltd., headed by Ranjan Walpola.

 

Kelani Tea Factory achieved an all-time record price of Rs. 980 for a low grown BOPFsp grade, surpassing its previous record of Rs. 940 which was established at last week’s auction (5-6 June). This line of tea was purchased by Mabroc Teas Ltd.

 

Kelani Tea Factory is situated in Yatiyanthota in the Sabaragamuwa Province at an elevation of 139m above sea level. This factory has an annual production of approximately half a million kilos of made tea per annum and is certified under Rain Forrest Alliance, ISO22000, HACCP, CQC and Ethical Tea Partnership. The estate is managed by Eranda Welikala and comes under the purview of Kelani Valley Plantations PLC. 

 

The record-breaking teas were marketed by Forbes & Walker Tea Brokers  Ltd.

 

Daily FT, 14th June 2018.

 

General demand at tea auctions this week


 

By Forbes and Walker 

Tea Brokers

 

This week’s auction volumes totalled 7.9 million kgs, marginally below last week’s quantity of 8.1 million kgs. There was fair general demand mostly at easier rates following quality.

 

Ex-estate offerings were similar to last and totalled 1.2 million kgs. Overall quality remained uninteresting, with a greater weight of offerings comprising of a fair average quality product. Encouragingly, the limited availability of reasonably good liquoring teas were absorbed at firm to dearer rates, whilst the plainer, and to a greater extent, the poor leaf teas, being discounted quite significantly. Consequently, the parity between a good quality tea, vis-à-vis their poorer counterparts, is a significant Rs. 100 per kg, and at times even more. The bottom of the market, which settled at around a Rs. 450 per kg level this week, compares poorly with the corresponding levels in 2017, and more so in USD terms.  

 

Low Growns maintained a similar volume to last week of 3.46M/kgs in the Leafy/ Tippy catalogues. In the Leafy catalogue, better BOP1/OP1’s maintained. Cleaner below best too maintained, whilst all others declined. PEK/PEK1’s, except for the well-made varieties, all others were easier. A selection of well-made OP/OPA’s maintained. Others declined following quality. In the Tippy catalogue, select best FBOP’s and well-made teas in the below best were firm to dearer whilst others were discounted. Few select best FF1’s and cleaner teas in the below best were firm to dearer, whilst all others declined. In the Premium catalogue, very tippy teas, particularly the leafy tippy varieties appreciated in value. Best and below best gained, whilst others declined following quality. There was good demand from shippers to Turkey, CIS, Iraq and Saudi Arabia.

 

Daily FT. 14th June 2018.

 

Tea auction this week


By Forbes and Walker Tea Brokers

 

The 20th sale of the year, which concluded yesterday, had a total of 7.93M/kg on offer. 

 

There was fair demand mostly at easier rates. Ex-Estate offerings were fairly large and totalled 1.5M/kg. Better Western BOPs declined by Rs. 20-30 per kg and more for last week’s high priced teas. The corresponding BOPF had on offer a few select invoices which gained substantially whilst the majority declined by Rs. 20-40 per kg and more following quality. 

 

In the below best category, a selection of BOPs gained Rs. 20-40 per kg following special inquiry whilst the corresponding BOPF declined up to Rs. 50 per kg. Plainer BOPs were irregular whilst corresponding BOPF - clean leaf teas up to Rs. 50 per kg easier, others Rs. 20-30 per kg easier. 

 

Nuwara Eliyas too were mostly lower following quality. Uva/Udapussellawa BOP/BOPF declined by Rs. 20-50 per kg. CTC teas were also lower by Rs. 20 per kg and more. Liquoring leafy teas continued to be neglected.

 

A salient feature of the sale was the strong demand for the limited availability of BOPs which are now commanding a premium of Rs. 30-50 per kg over their corresponding BOPF in most instances. It would also be relevant to note the bottom of the market for BOP/BOPF, which has settled between Rs. 500 and Rs. 520 per kg, is in keeping with the corresponding levels of last year. Notwithstanding, approximately a 5% depreciation of the SLR.

 

Low Growns totalled 3.1M/kgs in the Leafy/ Tippy catalogues. There was fair demand at lower levels. In the Leafy catalogue, a limited selection of well-made BOP1/OP1s maintained whilst others were irregular and lower. OP/OPAs too were generally lower by Rs. 5-10 per kg and more, particularly where quality was not maintained. Select best PEK/PEK1s were firm whilst others were barely steady. 

 

In the Tippy catalogue too, a select range of well-made FBOP/FF1s maintained while others were mostly lower. At the lower end too prices were generally lower to last by Rs. 10-15 per kg and more for the teas that did not maintain leaf style. 

 

In the Premium catalogue, a select range of well-made teas maintained whilst others were mostly lower to last. There was good demand from shippers to CIS, Turkey, Saudi Arabia, Iraq, Libya and Dubai.

 

Daily Ft, 25th May 2018.

 

Monthly tea auction averages down Rs. 25 in March


By Forbes and Walker Tea Brokers

 

March Auction average totalled Rs. 613.75 vis-à-vis Rs. 638.76 of March 2017, showing a decrease of Rs. 25.01. When analysing the respective elevations, High Grown average for March 2018 of Rs. 602.27 too shows a decrease of Rs. 32.57 vis-à-vis Rs. 634.84 of March 2017, whilst Mediums averaging Rs. 566.91 show a decrease of Rs. 35.49 vis-à-vis Rs. 602.40 of March 2017. Low Growns too averaging Rs. 628.98 have shown a decrease of Rs. 19.52 vis-à-vis Rs. 648.50 of March 2017. These averages also show a decrease in USD terms compared to the corresponding month of 2017.

 

When analysing the cumulative Auction average for the period January-March 2018 of Rs. 629.77 shows a gain of Rs. 21.74 vis-à-vis Rs. 608.03 of January-March 2017. High Growns for the period of January-March 2018 of Rs. 628.04 show a gain of Rs. 8.42 vis-à-vis Rs. 619.62 of January-March 2017, whilst Mediums averaging Rs. 571.86 have shown a gain of Rs. 7.58 vis-à-vis Rs. 564.28 of January-March 2017. Meanwhile Low Growns averaging Rs. 643.90 for January-March 2018 too have shown a gain of Rs. 29.08 vis-à-vis Rs. 614.82 of January-March 2017.

 

It is relevant to note that January-March 2018 prices show a decrease in USD terms compared to the price levels of January-March 2017 with the exception of the Low Grown average where 2018 prices are higher than 2017. It is also noteworthy that these levels are significantly higher both in LKR/USD terms when compared to 2016 levels.

 

Daily Ft, 05th April 2018

 

About F&W

Forbes & Walker was set up in 1881 as a partnership between James Forbes and Chapmen Walker. Although there is no actual record of the date on which it was established the very first cash book, still in the possession of the Finance Director, indicates the brokerages were earned from 1st August 1881. In Sir Thomas Villiers' book “Mercantile Lore” the date of establishment of Forbes & Walker has been put down      Read More...

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