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FAITTA AGM – 28th Aug, 1
Global Tea Market Review
FAITTA – 28th Aug, 2010 New DelhiSACHEN VERMA
Senior Vice President Marketing – JV Gokal & Co. Pvt Ltd
GLOBAL BLACK TEA PRODUCTION
• From the global perspective, World tea output has significantly recovered from lower production trend occasioned by drought experienced across the major tea producing countries in 2009 and 2008
• For the period up to May 2010, the three key producers of Black tea (India, Kenya and Sri Lanka), which account for about two-thirds of the world’s Black tea production, registered increased production of 115 Million Kgs compared to the same period of last year
• Kenya accounted for the highest increase of 61% (69 Million Kgs), while Sri Lanka registered an increased production of 25% (26.9 Million kg)
3
Major producing countries( Jan to June’10 )
COUNTRY
2010 2009 [+/-] mkgs 2010 2009 [+/-] mkgs
Bangladesh 6.30 6.70 -0.40 13.81 14.34 -0.53
India 104.04 118.05 -14.01 338.97 333.90 5.07
Kenya 29.82 25.34 4.48 213.01 139.28 73.73
Sri Lanka 29.50 20.50 9.00 166.90 132.20 34.70
Combined 169.66 170.59 -0.93 732.69 619.72 112.97
COMPARATIVE GLOBAL CROP : JUNE
During June Upto June
World Crop
Auction Prices for tea Across Major Tea Producers (USD/Kg)
Period To Date 2010
To Date 2009
% Variance
Kenya June 2.60 2.23 17 %
Sri-Lanka June 3.24 2.82 15%
India June 1.99 1.95 2 %
5
MOMBASA AUCTIONS( Weekly Price comparison )
MOMBASSA AUCTION AVERAGE
150
170
190
210
230
250
270
290
310
330
1 4 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49 52
Week
US
Cen
ts /
Kg
2008
2009
2010
KENYA EXPORTS (Jan-June 10)Destination Quantity in Million Kg
EGYPT 49 m KgUK 38 m Kg
PAKISTAN 31 m KgAFGHANSTAN 29 m Kg
SUDAN 13 m KgUAE 9.50m Kg
RUSSIA 7.4 m Kg
KENYA PRODUCTION (Jan-June)
2006 2007 2008 2009 20100
50
100
150
200
250
134.1
198.7
157.3139.2
213.0
YearProd
uctio
n (M
illio
n Kg
s)
SRI LANKA PRODUCTION
SRI LANKA CROP FOREACAST
10
COLOMBO AUCTIONS( Weekly Price comparison )
SRILANKA AUCTION AVERAGE
200
250
300
350
400
450
500
Week
Cen
ts /
Kg 2008
2009
2010
11
World Auction Average
Currency 2010 2009 +/- 2010 2009 +/- 2010 2009 +/-
INR 118.82 108.47 10.35 118.82 108.47 10.35 2.6 2.21 0.39
INR 97.82 102.21 -4.39 97.82 102.21 -4.39 2.14 2.08 0.06
INR 75.49 86.85 -11.36 75.49 86.85 -11.36 1.65 1.77 -0.11
BDT 172.97 128.41 44.56 114.19 91.62 22.57 2.5 1.86 0.63
US Cents 186.21 161.83 24.38 85.15 79.6 5.55 1.86 1.62 0.24
US Cents 278 243 35 127.13 119.53 7.6 2.78 2.43 0.35
US Cents 162.53 148.35 14.18 74.32 72.97 1.35 1.63 1.48 0.14
SL Rs 370.09 324.6 45.49 148.41 139.94 8.47 3.25 2.84 0.4
India Bang SL
Jan-Jun US$ 1 = 2010 45.73 69.27 114.04
2009 49.19 68.94 114.1
January to June (per Kg)
Centre
In Countrywise Currency In INR (Approx.) In US $ (Approx)
(approx)
WORLD AVERAGE TEA AUCTION PRICES
Kolkata
Guwahati
Cochin
Chittagong
Jakarta
Mombasa (Kenya)
Limbe
Colombo
Exchange Rates :
Auction Average
12
India - Production ( Crop Jan – June )
Price outlookCrop 2010
District / States2010 2009 [+/-]mkg [+/-]% 2010 2009 [+/-]mkg [+/-]%
Assam Valley 47.20 59.10 -11.90 -20.14 122.60 132.60 -10.00 -7.54Cachar 3.50 4.50 -1.00 -22.22 15.10 16.50 -1.40 -8.48Total Assam 50.70 63.60 -12.90 -20.28 137.70 149.10 -11.40 -7.65Darjeeling 1.20 1.10 0.10 9.09 3.60 3.70 -0.10 -2.70Dooars 15.90 16.70 -0.80 -4.79 45.50 44.40 1.10 2.48Terai 8.30 9.50 -1.20 -12.63 23.80 23.10 0.70 3.03Total West Bengal 25.40 27.30 -1.90 -6.96 72.90 71.20 1.70 2.39Others 0.70 0.90 -0.20 -22.22 1.70 2.10 -0.40 -19.05Total North India 76.80 91.80 -15.00 -16.34 212.30 222.40 -10.10 -4.54Tamil Nadu 20.80 18.20 2.60 14.29 89.80 76.90 12.90 16.78Kerala 6.00 7.40 -1.40 -18.92 33.70 31.80 1.90 5.97Karnataka 0.50 0.60 -0.10 -16.67 3.10 2.70 0.40 14.81Total South India 27.30 26.20 1.10 4.20 126.60 111.40 15.20 13.64Cumulative Total 104.10 118.00 -13.90 -11.78 338.90 333.80 5.10 1.53
During June Upto June
13
Production comparison ( India crop Jan – June )
Crop
Variance %
Region 2010 2009 2008 2010/2009 + / (-)
North India 212.3 222.4 225.9 -10.1 -4.5
South India 126.7 111.4 119.7 15.3 13.7
All India 339.0 333.8 345.6 5.2 1.6
* Qnty. in mil. Kgs
0 50 100 150 200 250
2010
2009
2008
South India
North India
14
2010 – Auction Prices ( North India )
Price outlook
Months * CTC leaf & all Dust
2010 2009 2008 2007
Jan 98.45 87.98 72.20 63.80
Feb 94.07 81.35 63.72 59.18
Mar 79.41 78.01 62.29 61.19
Apr 106.56 115.96 97.46 81.82
May 113.55 133.48 91.14 73.95
Jun 116.66 127.10 101.02 82.79
Jul 118.77 112.92 92.90 77.38
Aug 116.00 115.05 94.57 71.61
Sep 114.00 115.10 103.90 74.96
Oct 112.00 120.06 105.58 72.82
Nov 115.00 121.61 100.03 74.43
Dec 113.00 114.05 94.18 78.45 * Estimates for Aug to Dec'10
North India ( Auc.Avg. )
PRICE COMPARISION ( NORTH INDIA AUCTIONS )
405060708090
100110120130140150
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Month
Avg
. ( R
s/K
g ) 2010
2009
2008
2007
15
All India Exports( A Comparison – Jan to June’10 )
Export outlook
2010 / 20092010 2009 2008 2007 Variance
Jan 17.0 12.0 16.9 13.7 5.0Feb 12.2 12.1 16.1 11.1 0.1Mar 18.0 14.2 17.9 19.2 3.8Apr 12.7 11.3 11.9 9.0 1.4May 11.2 9.8 13.0 9.3 1.4June 12.8 15.0 14.8 13.6 -2.2July 19.4 18.5 10.3Aug 18.7 21.4 17.1Sept 18.4 19.5 15.3Oct 18.7 21.0 13.5Nov 19.2 15.6 12.7Dec 22.2 20.5 11.9Total 83.9 191.0 207.1 156.7 9.6
INDIAN EXPORTS ( A Comparision )
5
10
15
20
25
Jan Feb Mar Apr May June July Aug Sept Oct Nov DecMonth
Qn
ty.
(Mil
.Kg
s)
2010
2009
2008
2007
16
Region wise exports from India
Export outlook
Jan to June Jan to June Variance VarianceRegion 2010 2009 + / (-) %North India 36 38.4 -2.4 -6.25South India 47.9 36.2 11.7 32.32All India 83.90 74.60 9.30 12.47
0 10 20 30 40 50 60
2010
2009
Ye
ar
Qnty. (Mil. Kgs)
South India
North India
17
Market review 2010
• Like the Previous 3 months August crop in North India is expected to be down. Pest attack has been contained but not eradicated
• Industry likely to see another year of buoyant prices.
• Domestic demand expected to surge ahead.• Exports have been good on higher Orthodox
production.
Market review 2010
• Excepting North India all others regions are showing substantial increases globally
• If prices are at the current levels then a price hike is expected in the fourth quarter.
• Global production is expected to be more by 135 m kg
• Sri Lanka and Kenya are showing much higher crops but global demand is strong and prices are moving up
19