May 3: Making available quality tea at affordable price to consumers has been the motto of Piyush Desai, the current chairman of the Federation of All India Tea Traders' Association (FIATTA). In 1975, he took over as secretary of Gujarat Tea Traders' Association. Finding the platform relatively small, he floated Western India Tea Traders' Association in 1987. The FIATTA is the apex body of around 24 tea traders associations from almost all the states. In his mission, Desai has been courageous enough to take on the powerful tea lobby of the east and south. "The sole driving force against the powerful tea producers and multinationals was the aim to provide consumers with quality tea at reasonable rates", Desai explains while talking to The Financial Express.Excerpts:
On trends in domestic tea prices over the past couple of years and prospects in next two years
During the last one year, tea prices have risen by 25-30 per cent, compared with the prevailing prices at the teaauction. This rise is gradually reflected at the retail level in packet and tea prices. Representations by Western India Tea Dealers Association (WITDA) and Federation of All India Tea Traders Association (FAITTA) to the concerned authorities including chairman Tea Board of India for checking the rise in tea prices have proved futile.
On the role of Tea Board in boosting the trade and marketing Indian tea under one logo in the international market
It is the duty of the Tea Board of India to monitor public tea auctions held at Calcutta, Guwahati, Siliguri and Cochin among other centres. Also, it is expected to give proper guidance to the tea auctioneers as regards the Tea Marketing Control Order. In order to boost tea exports, the Tea Board should encourage new exporters instead of giving a chance to recognised and established exporters by circulating available export enquiries received by the Tea Board.
In this regard, what is disturbing is that the chairman of Tea Board of India hardlyinvolves himself in checking the rising tea prices. Tea Board chairman hardly expresses his opinions clearly to the brokers or to the tea producers in keeping tea prices at a fair and reasonable level. It was FAITTA which recently convened in Delhi a meeting of tea trading members with the Tea Board chairman and conveyed him that it is expected that he should check rising tea prices. This year, we hope to achieve export target of 250 million kgs this year without upsetting the present auction prices.
On international tea price trends
In 1997-98, tea prices were up at all auction centres around the world due to general shortage and a crop loss in Kenya. Against this situation, 1998-99 brings extremely bright prospects of massive crop outturn in the world; Kenya is already ahead with a record crop. Even in India there are good chances are of better tea crop this year.
On the size of domestic tea market vis-a-vis production
Currently, the size of domestic tea market is of 600 million kgs.Our total production of tea in India for the year 1996-97 was 780 million kgs. Deducting 180 million kg of tea exported to other countries, the domestic consumption is of 600 million kg. Of this, tea packets share is around 30-40 per cent, while remaining 60-70 per cent is divided between loose tea and bulk tea segments.
On developments at the National Tea Committee set up last year
You may be surprised to hear that despite setting up the National Committee on Tea (by the previous commerce minister) in September last, it met hardly once, that too was inappropriately organised and nothing materialised. However, after our meeting with the commerce minister Ramakrishna Hegde, we are hopeful that there will be a meeting of the National Tea Committee members to decide ways and means to boost tea exports among other vital issues. To promote tea export, it is essential on part of the government and the concerned bureaucrats including the commerce secretary, in charge of tea division, to be accessible toall connected with the tea industry. By keeping oneself out of reach, the bureaucrats are indirectly discouraging tea exports.
On the role of big tea companies and their impact on smaller packet tea companies
Last year, medium-sized regional tea companies saw little growth due to stagnancy in sales. Excessive advertising by big tea companies was mainly responsible for this. In our opinion, small to medium tea packet companies should concentrate giving good quality tea at a fair and reasonable price rather than spending huge amounts on advertising. If big tea companies cut their advertising budget by say 50 per cent, they can sell their brands cheaper by at least Rs 6-10 per kg than the prevailing retail price.
On possibilities of future trading in tea
Future trading in tea has never been considered probably because there is a wide variance in quality in tea cropping months and therefore seems unlikely in near future.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
