A ₹38 hike in the daily cash wage of labourers has been a major factor in price realisation of tea declining markedly below the cost of production, a tea planters’ body has said.
The North Eastern Tea Association (NETA) on Wednesday said the tea industry was struggling for survival due to an 18% dip in the price realisation of tea compared to that in 2020.
“The price realisation of tea has gone down by ₹44.19 per kg in a year while the cost of production has gone up due to the hike in wages and increase in the cost of inputs such as fertilizers, pesticides, diesel, natural gas, coal and transportation,” NETA adviser Bidyananda Borkakoty said.
‘Negative impact’
The cost of production of processed tea had gone up by ₹25 a kg. The daily cash wage hike from ₹167 to ₹205 and a ₹7 increase in input costs led to a “negative impact” on the industry to the tune of ₹76 per kg of processed tea, he said.
According to the Guwahati Tea Auction Centre (GTAC), the average price realisation of CTC tea from April to July this year was ₹208.02 per kg, down by ₹44.19 from ₹252.21 per kg during the same period in 2020.
“Only about 9% teas have fetched above ₹300 a kg and about 51% of teas have got sold below ₹200 per kg,” NETA chairman Sunil Jallan said.
