Week 47, 2015
Tea market report 16-20 November, 2015
The general rule that markets never go up or down in a straight line, was partially confirmed by this week’s Mombasa auction. After weeks of easing auction prices and despite a larger offering than the week before, most better quality grades traded firm to dearer in this week’s auction. Especially support from Afghan & Pakistan buyers for the best, below best and medium BP1 & PF1, made these segments move upwards. Other description came on average down. The current weather conditions are close to ideal for growing tea, which is seasonally normal.
There wasn’t an auction in Limbe this week. The October crop figure has been published, which is the smallest figure in 20 years and the year to date production is the lowest of the last 10 years. This is also reflected in next week’s auction quantity of only 1,640 pkgs, compared to 4,000pkgs last year. We received some reports that the estates received useful rains, but the current weather is hot again.
In Colombo demand recovered a bit from last week but didn’t come back in the pace as in the weeks before. Winter buying could be one of the causes of the firming demand, but also a stable Turkish Lira inspired buyers. Although it is raining in the tea growing areas, the crop intake is declining slightly, which is also reflected in the declining auction quantities.
In Jakarta demand remains more than healthy with only 4% outlots in the past week’s auction. West Java is receiving heavy rains, Middle and East Java are receiving light intermittent showers interrupted by sunny & overcast periods. It is expected that it will take some time before these rains will turn into tea and higher auction quantities. The offerings at the coming auctions remain at least 50% lower than last year’s auctions in the same period.
In Vietnam the weather is hot and dry, which is quite unusual. In the south the season will be over soon but in the middle and north tea planters hope to have some good plucking rounds in the coming weeks. Demand for High Grown green tea remains firm, also for leafy orthodox teas demand isn’t weakening. The tea growing areas in Argentina are receiving heavy rains. After the frost and the strikes earlier this season, production is running behind last year’s. Rains are currently the main cause tea pluckers can’t go into the field with their machinery.
Plucking in Kenya is in full swing, Vietnam is extending the season, Indonesia is receiving the first weeks of rain and in Malawi the first rains have arrived. China, Vietnam and India are moving towards the close of the season. Demand remains firm but supply for the coming months is likely to remain healthy.
“Two things are infinite. The universe and human stupidity. And I’m not so sure about the universe.” – Albert Einstein
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