COLOMBO TEA AUCTION 10/06/2015

C O M M E N T S

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This week too, a total of 8M/Kgs came under the hammer. There was fair demand.

Ex-Estate offerings comprised of a 1.2 M/Kgs. Overall quality of offerings showed no significant change. This week there was better demand and consequently a firm to dearer trend in prices-which could be attributed to a combination of the recent depreciation of the SLR vs. US$, Global Tea Production-recording a decline of approximately 50 M/Kgs so far in 2015 vs. 2014 and the significant appreciation in prices at the Mombasa Auction over the past several weeks would have also contributed to the much awaited turn-around in the market this week. However, the overall Colombo Auction average is still below the corresponding average in 2013. From a global perspective, the current Auction prices would appear good value and considering the improvement in product quality that is observed in the forthcoming sales, it would be reasonable to anticipate a gradual upward movement in prices from now on.

Best Western BOP’s declined Rs. 10/- per kg on average whilst the corresponding BOPF’s gained Rs. 10-20/- per kg. In the below best category a selection of brighter BOP’s gained Rs. 10-15/- per kg whilst the others declined by similar margin. Corresponding BOPF’s gained Rs. 10-15/- per kg. Plainer BOP’s were irregular and barely steady whilst the corresponding BOPF’s gained Rs. 10/- per kg and more for a selection of clean leaf teas. A disappointing sale for the Nuwara Eliya’s where most BOP’s remained unsold whilst the corresponding BOPF’s recorded a decline of Rs. 20/- per kg. Udapussellawa BOP’s were irregular following quality whilst the corresponding BOPF’s gained Rs. 10-20/- per kg. Uva BOP/BOPF’s also appreciated by similar margin. High Grown CTC teas were barely steady whilst the Medium Growns and Low Growns-particularly the clean leaf types gained Rs. 10-20/- per kg.

Shippers to the CIS continued to be reasonably active on a wide cross section of the offerings together with Japan, South Africa and Hong Kong. Once again interests from UK and the Continent appeared selective.

Low Growns comprised of approximately 3.8M/kgs in the Leafy /Tippy catalogues. There was fair demand. In the Leafy catalogue better made OP1’s together with BOP1’s sold at firm to irregularly dearer rates. Better OP/OPA’s too were fully firm whilst others and the teas at the lower end were marginally lower. Better PEK/PEK1’s were firm to dearer with the exception of the bold PEK’s that declined Rs.5-10/- per kg and more towards the close. In the Tippy catalogue FBOP/FF1’s were irregular and lower by Rs.5-10/- per kg and more. At the lower end too prices were mostly easier. Tippy invoices too were irregularly lower barring a select range of teas that held firm. Shippers to CIS, Turkey, Dubai, Saudi Arabia, Kuwait and Iraq were active.

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