Colombo Tea Auction Market opens on bullish note

The Colombo Tea Auction which opened yesterday – which was not only the first trading day for the year 2018, but also the first market day after the Russian ban on Ceylon Tea was lifted – kicked off on a buoyant note with exceptional demand from Middle Eastern markets and keen interest from Russian markets.

Lanka Commodity Brokers Ltd Director Jehan Algama told Ceylon FT yesterday about the rise in demand from Middle Eastern and Russian markets. He also qualified the Russian demand as having keen interest only during the Russian New Year Holidays, which extend to around the second week of January, by which time there would be firmer demand and purchases. “It is not that our teas are bad, but the Russians are still on holiday and the Russian Orthodox tea centres are closed till the second week of January,” he explained. “We expect the Colombo tea auction to peak from the last sale in January.”

“Russia is also buying out teas fully, but not at the usual pace. The market opened up a little irregularly, but firmed up later during the day,” he said. Leafy Grades firmed up to be dearer yesterday compared to the last auction prices last year, he mentioned. The Tippy tea grades which were supported by Iran were also dearer on last. The poorer types were irregularly lower, but, overall, it was indeed a healthy market, he said. He also said that the High Growns would be sold today, with a similar trend expected. Responding to a question as to……how he anticipated the market to firm with the return of the Russian buyers mid-January 2018, he said that there was bound to be a cascading effect on prices as well, with much better prices that prevailed prior to the fallast December.

He also expected prices to remain buoyant with the over all short-fall in the global production of teas, despite the Indian tea production being slightly higher. but not in accordance with their expectations. Africa also has its own issues regarding its tea production, which would also augur well for Sri Lanka’s tea exports right now, he said.

(Source: Ceylon Today)