CHENNAI: Export of Indian teas increased by 5.7 per cent in the first four months of 2017 as other two major tea exporters – Kenya and Sri Lanka – struggled with erratic cropping patterns leading to supply side issues, said credit rating agency ICRA.
The continuation of such a favourable export scenario going forward would have a positive impact on domestic prices as well, but cost pressures due to increase in wage rates, particularly in the Assam tea gardens, could keep margins in check, the agency said in a release.
India exports around 20 per cent of its tea production. However, exports play a vital role in maintaining the overall demand-supply balance and, thus, price levels in the domestic market.
“While the export performance in recent months is encouraging, the full-year performance will be determined by the volumes during the period June to August, when most of the export contracts are finalised,” said Kaushik Das, Vice President who heads corporate sector ratings at ICRA.