CALCUTTA, Dec 23: Tea brokers have denied all allegations of being in league with the producers for raising tea prices, saying that a drop in global supplies and increase in exports have left little crop for the auction houses.

"The price rise is largely artificial as there are hardly any teas available in the auction houses," said an official of a tea broking firm.

The top brass of auction houses are expected to discuss the unprecedented price rise with the Tea Board soon.

It is believed that Calcutta auction houses have nearly finished their stocks with the tea season coming to an end, except for a few orthodox varieties. On the other hand, the Guwahati auctions have almost depleted the stocks of CTC varieties.

According to a producer-seller, with prices reaching the best possible level already, there would be no justification to hold on to stocks, if that is the case as propagated by many buyers.

"Teas have been declining as a result of increasing exports in the last few months. Export figures have been higher by over 27 million kg up to the end of October. On top of this there was the crop crisis in Kenya when production was down by about 40 million kg during the same period," said the official.

"Although production here increased by 27 million kg up to the end of October, this was neutralised by an equivalent rise in exports this year," he added.

Exports were more this year as buyers of Kenyan tea switched to Indian varieties. Kenya used to export almost 90 per cent of its crop earlier, and a drop this year led to buyers switching to other markets.

Tea prices may rise further with fear of production deficit in North India due to the early onset of winter. Industry sources said that cold waves in North Bengal as well as in higher parts of Assam affected the crop and many gardens had been unable to pluck during the later months, particularly in November.

"With continuing harsh climatic conditions, the first flush teas may be affected adversely. As a result, there would be lesser teas in the early part of the next year," he added.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.