ECONOMYNEXT – Sri Lanka’s tea prices declined across elevations by 2.6 percent to 1,440.60 rupees a kilogram at the last sale of October 22, the third week in a row that prices fell, industry data showed, with dollar prices also easing amid US monetary tightening.
Sri Lanka’s tea prices soared in rupee terms from around 700 rupees a kilogram in the first week of 2022, to 1600 to 1700 rupees a kilo as the rupee collapsed after macro-economists printed money for two years and a botched float with a surrender requirement.
The rupee average rose to as much as 1676.93 rupees a kilo in the first week of October.
Dollar prices also rose from around 3 a kilogram to 4.62 dollars in the first week of October, as the US Federal Reserves fired a commodity bubble by printing money for ‘stimulus’.
The US 2022 started to aggressively tighten monetary policy, which usually leads to commodity prices falling back.
Crops like coffee, which have an active forward market, started to decline from the peak around June. Tea prices are generally late in taking off and also falling based on past trends linked to commodity bubbles fired by the Federal Reserve.
Low-grown teas, farmed mainly by smallholders and exported to the Middle East and Central Asia, are the most sought-after and expensive Ceylon Teas.
Low growns also fell 2.1 percent to 1516.83, data released by Ceylon Tea Brokers showed.
Low-grown CTC prices have gained this week to 1,110.73 per kilogram this week from 1,076.33 per kilogram last week.
Orthodox teas have slipped to 1,544.03 per kilogram from 1,584.48 per kilogram.
BOP’s all types were lower.
BOPF’s in general, are easier to market
FBOPF/FBOPF1’s select best and best shed in value, whilst the below best and bottom had a sharp decline.
Select best BOP1s were easier whilst best and below best were firm. Poorer types were firm to lower.
OP1’s Select best were marginally lower whilst best and below best declined. Poorer sorts
were fully firm.
CTC medium-grown category gained to 1,102.32 rupees per kilogram from 1,068.71 rupees per kilogram.
Western medium was down from 1,260.20 rupees to 1,190.61 this week.
Uva teas fell 81.23 rupees to 1,257.03 rupees per kilogram.
BOPF’s Select best gained whilst all the others declined.
BOP1’s Select best gained by Rs.100/- per kg, whilst best declined by Rs.50/- per kg. Below best and poorer sorts eased by Rs.100/- per kg.
OP1’s Select best declined by Rs.150/- per kg whilst all others shed by Rs.100/- per kg.
OP/OPA’s select best moved up by Rs.100/- per kg whilst the others eased by Rs.50/- per kg and more towards
the closure of the sale.
PEK’s Select best and best were firm whilst all others lower by Rs.50/- per kg and more towards the closure of the sale.
PEK1’s Select best declined by Rs.100/- per kg whilst best lower by Rs.150/- per kg. Below best and poorer sorts shed by Rs.100/- per kg.
CTC high grown rose 59.47 rupees per kilogram to 1,265.25 rupees a kilogram.
Western High fell 27.39 rupees to 1,429.77 rupees per kilogram.
While Uva fell 62.59 rupees to 1,271.51 rupees per kilogram.
BOP’s Best Westerns were lower by Rs.50/- per kg. Below best and plainer types mostly firm. Nuwara Eliya’s were irregular.
Uda Pussellawa’s firm to Rs.100/- per kg easier. Uva’s declined by Rs.50/- per kg and at times more.
BOPF’s best westerns were firm to Rs.50/- per kg lower. Below best too followed a similar trend. Plainer teas were firm.
Nuwara Eliya’s had hardly any offerings. Uda Pussellawa’s drop up to Rs.100/- per kg. Uva’s were lower by Rs.50-100/- per kg.
Sri Lankan tea has been earning higher prices for tea exports in rupees after the currency was depreciated in March against the USA dollar in 2022.
This week 5.3 million kilograms were offered for sale.
Next week 5.3 million kilograms will be offered.