Tea stocks surge post first round of Rs 20/kg price hike
Mcleod Russel, the largest producer of tea in Asia is up close to 8%. Mid-sized companies like Harrisons Malayalam and Jayshree Tea have posted double digit gains. Stocks like Hindustan Unilever (HUL) and Tata Tea which account for 70 per cent of market share in the tea trade will come under pressure as they are buyers of tea.
Top Tea Producing Companies :
Mcleod Russel, the largest producer of tea in Asia is up close to 8%. Mid-sized companies like Harrisons Malayalam and Jayshree Tea have posted double digit gains. Stocks like Hindustan Unilever (HUL) and Tata Tea which account for 70 per cent of market share in the tea trade will come under pressure as they are buyers of tea.
Top Tea Producing Companies :
- Mcleod Russel
- Harrisons Malayalam
- Williamson Magor
- Jayshree Tea
- Assam Company
- Tata Tea
- Hindustan Unilever
Mr Harendra Shah, President, Federation of All-India Tea Traders Association (FAITTA), said
The hike in prices has been necessitated on account of lack of rains, plucking of tea leaves at a very low rate in the North and South India tea gardens.
In 2008-09, the average price rise was 55-60 per cent at the auction centre but the consumer price rise was only 25-30 per cent.
Tata Tea and HUL have also decided to mark up prices by Rs 40 a kg in two instalments
“International tea prices have shot up due to the crop failure in Kenya and Sri Lanka,” said Mr Bhupat Shah, President, Retail Tea Merchants Association.
“People should understand that the price hike will not add up to our profit as most tea companies are operating below their production cost in the last few months. Currently, tea is sold by the traders at a loss” .
The hike in prices has been necessitated on account of lack of rains, plucking of tea leaves at a very low rate in the North and South India tea gardens.
In 2008-09, the average price rise was 55-60 per cent at the auction centre but the consumer price rise was only 25-30 per cent.
Tata Tea and HUL have also decided to mark up prices by Rs 40 a kg in two instalments
“International tea prices have shot up due to the crop failure in Kenya and Sri Lanka,” said Mr Bhupat Shah, President, Retail Tea Merchants Association.
“People should understand that the price hike will not add up to our profit as most tea companies are operating below their production cost in the last few months. Currently, tea is sold by the traders at a loss” .
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