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Tea exports in steep fall

Refayet Uli ah Mirdha
Tea exports declined by 85.61 percent in July-September, compared to the same period a year ago, because of high prices, decreased production and increased domestic consumption, industry insiders said.
In July-September, Bangladesh exported tea, a widely consumed global beverage, worth $0.80 million against a target of $3.17 million, registering a 74.76 percent gap between target and export, according to Export Promotion Bureau (EPB) data.
The data also showed the export target of tea at $12.90 million for fiscal 2009-10, while the actual export in 2008-09 was worth $5.56 million.
Talking to The Daily Star, a senior official of the Tea Traders Association of Bangladesh (TTAB), said growers are now struggling to maintain the supply of tea in line with growing local demand.
According to the trade body, around 56 million kilograms of tea are produced a year against demand for 55 million kilograms.
"On the domestic market, annual tea consumption increases by 10 percent due to urbanisation and changes in lifestyle," theTTAB official said.
"We need a total production of 65 million kilograms at the moment to meet domestic and export demand. If the declining trend continues, the country will soon need to import tea to meet growing domestic demand."
The TTAB data showed total tea production was 58.75 million kilograms in 2008, 57.95 million kilograms in 2007 and 53.40 million kilograms in 2006.
According to TTAB, the tea production target was set at 56 million kilograms for 2009, which may not be met because of inadequate rainfall, high prices of agricultural inputs and ineffective management of the state-owned National Tea Company Ltd (NTCL), one of the largest tea estate holding companies.
NTCL Secretary M Naufel Karim Khan said the state-owned company's production dropped because new saplings had not been planted over the years.
Furthermore, NTCL will have to use higli priced fertilisers and pesticides to obtain yield from the old trees in the company's 12 tea estates, which push the cost of production up and ultimately leads them to miss targets.
NTCL's yield gradually dropped to below 800 kilograms a hectare in 2008 from over 1,100 kilograms in 2005, while the country's average yield a hectare stands at about 1,250 kilograms, the NTCLofficial said.
In 2008, the average price of NTCL tea was Tk 106 a kilogram, against Tk 117 a kilogram on average in the market -- about Tk 10 less than the country average.
Similarly, NTCL's average price a kilogram was Tk 14 lower than the country average in 2007 and Tk 15 less in 2006, the NTCL official said.
However, tea production by the state-owned tea estates declined sharply on a year-on-year basis, due to corruption, mismanagement and fund constraints.
Over the last few years, political party stalwarts have headed NTCL, but mismanagement and corruption became order of the day.
NTCL tea production stood at 44.43,517 kilograms in 2008 and 42,55,063 kilograms in 2007, dropping from 47,65,668 kilograms in 2006 and 56,21,856 kilograms in 2005, according to the NTCL secretary.
Denying corruption and mismanagement, the company secretary identified fund constraints as the main obstacle to growth.
"NTCL could not even replant the required 2.5 percent of tea saplings every year because of such fund constraints. No new plantation has taken place since 1978," Khan said.
reefat@thedailystar.net