Almost 30% jump in tea prices in the global market is raising alarms regarding the future repercussions, such run away price situation can have on the future of this important beverage crop. Present ruling price of about $ 3.18 per kg of black tea is considered too tempting for many planters to either start new gardens or expand the existing ones with great expectations regarding windfall profits in the coming years. It is true that there is a marginal demand-supply gap to day due to many reasons and expanding the area may not be a wise option to deal with this situation. New gardens are likely to create a surplus once they start producing tea in about three years' time.
"While India has pledged not to expand its tea areas beyond what is required for replanting and rehabilitation, there is concern that producers elsewhere could plant more in an attempt to capitalise on the high prices or protect against future crop failures. The result could be too much tea once new tea bushes reach maturity in three years' time, which might lead to a price crash"
It is to the credit of India that it has pledged not to expand the area, anticipating the undesirable consequences of a production glut that can imperil the economics of tea industry. Consumption of tea is becoming popular because of its refreshing effect on the consumer and the plethora of antioxidants present in them capable of neutralizing oxy-radicals responsible for cellular damage.
V.H.POTTY
http://vhpotty.blogspot.com/
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