March 19th, 2021

Rain arrives, a welcome relief to tea farmers. Most of the tea regions, including Darjeeling, Assam, Arunachal Pradesh, and the Nilgiris in the south saw some showers, promising a good season ahead.

PRICES

SALE 10 indicates a market correction. Overall there were  marginal price variations from the previous week, no more than a rupee or two, across auction averages.

The auction centres in Coonoor, Coimbatore, Kochi and Kolkata saw sales this week. Coonoor saw 85.48% of the offering sold, attributed to quality improvement as the season picks up. Data from the south indicates that dust tea has had more takers; of the total quantity on offer, 90% in Coonoor and 93% at Kochi were sold. Kochi saw better average prices than Coonoor at INRs 166.

Current prices indicate that the market is on track and prices are predictable. The upward trend is expected as we get closer to April.

PRODUCTION

Some of the lower elevation gardens in Darjeeling have started offering the first flush. The higher elevation gardens are still producing the EX markings. We should start seeing the DJ markings in the coming weeks.

Early reports on tea quality has been very promising. Online retail prices are between $27-68  per 100 g.

We also caught with Atul Asthana of the Goodricke Group which owns the estates of Castleton, Thurbo and Badamtam in Darjeeling. While he reiterated concerns about less rainfall he is optimistic about the season. He expects a good flush in the second fortnight of March thanks to the rain fall they have received. He adds that prices should be good as everything is pointing towards good quality. Given what last year this time was like, with estate closures due to Covid and loss of first flush, expectations are modest, with hopes for a normal year with volumes as was achieved in 2019.

EXPORTS

Exports are still below par as winter in several destination countries also means that waterways are closed at the moment. We reported last week about container fees going up 50-200%, so logistics will be an area we will continue to track for sometime. For Darjeeling which relies heavily on exports, higher container fees could add an additional 1000 rupees per kilo, at shipping costs being $39 for 3 kilos between Darjeeling and New York, London and Paris.

Exports also remain a concern as India comes up against Kenya in both production and prices. This is compounded by lockdowns in Europe which has severely impacted orders, in particular from the hospitality sector. Kochi reported that prices of orthodox tea dropped due to lukewarm response from exporters to CIS countries and West Asia.

We spoke to Pranav Bhansali of Bhansali and Company, one of the largest buyers and exporters here. He says, “As long as there are no supply side shocks (lockdowns, weather etc.), India should have a good year. This year, Indian exporters will find out which markets have been lost due to the pandemic. It’s a wait and watch situation.” 

At the moment, things look reasonably good but the mood is more of cautious optimism among everyone.

India Price Watch 

Sale 10 ended with auctions in Kolkata in the north, and Coimbatore, Kochi and Coonoor in the south. There was no significant change in prices compared to the previous week. At this time, it’s the dust tea that’s being picked up by buyers. We should begin to see the upward shift in prices as tea regions across the country received rain showers, as was hoped. Tea producers were relying heavily on this rain. Darjeeling has begun first flush, with lower elevation gardens already into DJ markings, while those at higher elevations are producing EX. All eyes on April for the full picture of Indian first flush but it appears that the season will meet expectations.  

Online Retail Prices per 100 grams Listed by Garden, Darjeeling, India	INRs | USD
Glenburn Tea Estate	4950 | $68.21
Upper Namring Tea Estate	4598 | $63.36
Ringtong Tea Estate	3750 | $51.67
Risheehaat Tea Estate	3450 | $47.54
Puttabong Tea Estate	3300 | $45.47
Balasun Tea Estate	2975 | $40.99
Rohini Tea Estate	1990 | $27.42
Source: Nathmull’s Tea | Prices as of March 17

 

China Price Watch – March 17

China rates weather and labor conditions on a scale of 1-5, with 5 indicating ideal conditions. In most regions this week the current harvest conditions are rated 3 or 4 which is described as optimal with no extreme weather events and temperature and humidity contributing to the plants’ growth. Early harvest West Lake Longjing No. 43 in Manjuelong Village, began March 12 but there is only a small number of trees are ready to pluck. Large-scale harvesting of West Lake Longjing Tea is expected to start in late March. Meitan from Guizhou is available in quantities along with most of the tea grown in Hubei (Wufeng Green).

Average Domestic Prices for Finished Tea in USD per 500 grams	Low	High
Westlake Dragonwell (西湖龙井) | Hangzhou, Zhejiang	$615.20	$692.10
Biluochun (Spiral Spring Green) (洞庭山碧螺春) | Suzhou, Jiangsu	$461.40	$1,353.44
Huangshan Maofeng (洞庭山碧螺春) | Huangshan, Anhui	$92.28	$246.00
Xinyang Maojian (信阳毛尖) | Xinigyang, Henan	N/A	N/A
Liu’an Guapian (六安瓜片) | Lu’an, Anhui	N/A	N/A
Taiping Houkui (太平猴魁) | Huangshan, Anhui	N/A	N/A
Meitan Cuiya (湄潭翠芽) | Zunyi, Guizhou	$83.05	$123.04
Wuyi Rock Tea (武夷岩茶) } Wuyishan, Fujian	N/A	N/A
Dafuo Dragonwell (大佛龙井) | Xinchang, Zhejiang	$104.58	$230.70
Wufeng Green (五峰绿茶) | Wufeng, Hubei	$46.14	$153.80
N/A indicates insufficient quantities harvested to establish a reliable price range..