Business · Energy & Commodities · 2 hrs ago

Tea producers welcome proposal for minimum sustainable price

Tea producers welcome proposal for minimum sustainable price

A Tea Board of India committee has recommended a minimum sustainable price for tea in India.

Tea industry stakeholders welcomed the proposal, saying it could help producers cover costs and support higher wages for garden workers.

They say tea prices have risen by about 2–3% a year, while input costs have increased by an estimated 10–14%.

Producers are also concerned that implementing the Code on Wages could add to wage costs and strain their finances.

The proposal has been sent to the Ministry of Commerce, which has not decided whether to approve it.

Producers say the proposed price band would cover production costs, but have not given details of the price or its effect on shop prices.

The industry employs millions of workers across large and small tea gardens, and stakeholders say better returns are needed to keep operations and investment going.

1 source

Related

What people are saying

C. K. DhanukaChairman of Dhunseri Tea and Industries
A Minimum Sustainable Price framework is therefore essential to bridge the widening gap between production costs and market realisations and to ensure the long-term sustainability of the industry,
via The Hindu
Suneel Singh SikandChairman of the Indian Tea Association
Ensuring remunerative returns to producers is critical to sustaining operations, facilitating investment in re-plantation and productivity enhancement and securing the industry’s long-term sustainability,
via The Hindu
Hemanta BangurFormer president of the Indian Tea Association
The market is dysfunctional and there is no level playing field. If market forces are left to determine the fate of industry, it will bring about the demise of tea gardens,
via The Hindu
Tea industry associationsPress statement quoted in The Hindu
Over the years, tea prices have registered a marginal compound annual growth rate (CAGR) of approximately 2–3%, as compared to an estimated CAGR of 10–14% in input costs.
via The Hindu