Tea Board to intervene in auction for few more weeks

Rasika SOMARATHNA

The Sri Lanka Tea Board will continue to intervene in the tea auction at least for a few more weeks, to ensure that confidence remains high among buyers, the Plantation Industries Ministry said yesterday.

Ministry sources said Minister D.M. Jayarathne had briefed the Cabinet regarding moves to keep buyer enthusiasm at high levels with several new initiatives on the way to sustain momentum with regard to price stabilisation.

The Tea Board intervened at the auction on October 24 by purchasing tea up to 917,995 Kgs at Rs. 231.8 million mainly from the low grown tea catalogs. The Ministry noted that this had a salutary effect on the prices and had made a positive impact on the enthusiasm of buyers bidding at the auction.

Thus although authorities had made plans to purchase tea through brokers while identifying relevant lots and prices, the necessity to intervene in the Auction held last Tuesday had not arisen as biddings and prices remained reasonably high than expected , the sources said.

The Board decision not to introduce teas, withdrawn at last week’s Auction too had a positive impact on raising prices and buyer enthusiasm, they added.

As a result, the total volume on offer at Tuesdays auction had dropped down to about 5.5 million Kgs.

The competition at the auction next week is expected to be higher as Russian buyers come into play a more active role.

According to sources, Russian buyers are reluctant to buy between November 15 and December 15 as most Russian Ports would be closed due to winter.

Thus as the Russians rush to have buffer stocks in preparation for winter, the competition is expected to grow during next week fetching better prices for Sri Lankan tea, the sources said.