Tea Industry Faces Declining Production and Prices Amidst Myriad Challenges

In the first tea season of the year, the tea industry is grappling with a decline in both production and prices, presenting a myriad of challenges. Reports indicate a significant drop in tea production, with a targeted decrease of 13.4 million kg from January to March compared to previous years. Additionally, prices fetched at auctions have also seen a decline, with the average price per kg dropping from approximately Rs 145 to Rs 131 during the same period. This downturn has cast a sombre mood over the industry, with the Indian Tea Association (ITA) highlighting adverse weather conditions as a major contributing factor.

The increase in temperature, coupled with insufficient rainfall in the Brahmaputra valley, has hampered tea production, while heavy rains and thunderstorms in the Barak Valley throughout April have further exacerbated concerns among planters. The situation is compounded by broader challenges facing the industry, including climate change, fuel price hikes, wage increases, and a decline in exports. Despite initiatives announced by the Assam government, such as the Bharat Auction model introduced in April 2023, which later reverted to the English model due to issues with fair price discovery, the tea sector continues to face uncertainties. Particularly, regions like Darjeeling are facing additional challenges, including a decline in production and prices, compounded by the influx of teas from Nepal. The ITA has urged the central government to extend financial support to the tea sector, a move endorsed by the Parliamentary Standing Committee on Commerce, in order to address the industry’s pressing needs and ensure its sustainability.