Intense nail biting as tea flounders

Last week apart from the charity auction we said the tea market was boring with nothing significant to talk of. Meaning bottom line for sellers of the Trade in Colombo.

Director Ceylon Tea Brokers Ltd., Russell Tennekoone said there was now serious concerns that the market had dropped. Low growns dipped Rs. 20. per kilo. Domino effect of such drastic down turn would have telling effects on the entirety of market trends.

From relative prosperous phenomena to such serious negativity did have to have some explaining. Tennekoone said there were quite some causes. Most damaging was that the Dubai port of Jebel Ali had reported congestion and cargo movement wedged into bottle neck restricted free movement of goods and services. Tea was a major casualty. Cascading effects of disruption had restrictive movement out of Colombo stultifying shippers buying fearing out bound cargo taking alarming time lag to take to voyage time.

He said although this was a major influence there were others. Not least the Dollar crisis, and Wall Street crash, notably its influences on the Euro.

There was one other, he said Dubai, had introduced quality certification which had also caused ripples not only in Colombo, but other seller origins.

Were we in for ‘rough seas’? Indications were that that was possible. ‘But knowing resilience of tea and its capacity to absorb crisis, would this ‘dooms day’ phenomenon last?’ Good question, Russell Tennekoone said. Guesses notwithstanding, return to prosperity could not be written off. ‘But estates should realize muck will not sell. There was thought that at best times anything sold well. That has now disappeared. Only good tea will sell at expected prices.’

He was in effect cautioning Planters that they would have to work hardrer. This column had quite such identical observations about three weeks previously. This may not be news to Planters, but worth repeating .

Although reports were that there was reasonable general demand for Ex-Estate teas, it was that low growns took quite a beating.

Private tea factory owners were worried they would not be able to meet their bank commitments, so too Plantation Companies.

Mixed crop entities were not that much in crisis., they said.

Quantum auctioned last week was 6.2 million kilos. Good teas sold, bad teas were discounted.

There was an interesting news piece in the tea market report of Ceylon Tea Brokers. ‘A single cuppa contains 200 milligrams of flavonoids. Drinking three cups a day, would increase flavonoids in the blood by approximately 25 %. Flavonoids help fight pre-mature aging,heart decease, and some types of cancer.

All told prices in Colombo should attract more overseas buying.

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