"A good variety CTC Tea now fetches Rs 65 per kg and Orthodox Tea Rs 95 per kg at the auctions. They are about Rs 10 per kg more than the prices last month," said Jaduram Agarwal, member of the Coonoor Tea Trade Association management committee, which holds the local tea auctions.

Higher Russian demand for Indian tea is likely to help prices to remain firm until year-end.

"The Russians need tea from all possible sources to satisfy winter demand. India presently caters to the market," said Maniram Sharma, another committee member.

But tea production is likely to fall in weeks ahead with the onset of cold and frosty conditions from December.

"Usually, towards Christmas and New Year, some of our plantations face frostbite. This year, winter seems to have set in early," said Krishnamoorthy Sampathkumar, a tea planter.

A leading buyer for theRussian market, who did not want to be identified, said: "Our principals are keen to step up stocks so that when it actually freezes in Russia, there would be enough teas for the households."

Demand for tea might slacken once waterways freeze in Russia during winters, hampering goods movement, Agarwal said.

Traders said supplies of tea had already slowed because unseasonal rains in October had damaged prospects of a bountiful harvest.

"Some of our plantations are affected by a stem infestation called Pestolatia Thai. It would take a long time for the affected plants to recover," Agarwal said.

A leading auctioneer said: "Till November beginning, the volume of teas sold at the Coonoor auctions has dropped to 61.5 million kg from 64.9 million kg in the same months of 1997."

"Although, on the average, prices rose by Rs 10 per kg in this period, supplies could not match last year's because of adverse cropping conditions in the last few weeks," he said.

"There is no way the production in South India canexceed last year's level of 210 million kg. Presently, we do not see the crop going beyond 205 million kg," said Thatha Rangiah, chairman of Incoserve, the largest co-operative of tea producers.

But overall tea production was expected to rise to an all-time high of 845 million kg, from 810 million kg produced in 1997, said an official of the Consultative Committee of Plantations Associations.