Border permit holding up tea exports to Pakistan

      
Markets in Pakistan still remain elusive for tea traders of Punjab, because Pakistan doesn't allow import of tea across the Attari border. The neighbouring country is also yet to allow transit to Indian tea-traders for the export green and black tea to Afghanistan, although it allows transit to Afghan traders for exporting dry fruits to India across the Attari border.


 

              

"Punjab's annual turnover from green and black tea exceeds Rs 1000 crore, which could double if Pakistan allows the export of tea across the Attari border and allows transit to Afghanistan," said RK Goel, former president of Amritsar Tea Traders' Association, while speaking to TOI on Thursday.

    

He said the association represents tea-traders of Punjab as Amritsar makes the maximum contribution to the trade and used to be the only tea-trading hub in Punjab before other cities pitted in. Amritsar has several tea-processing units too, he added.

Tea INDUSTRY Of PAKISTAN

        Pakistan is a leading tea consumer in the world. In fact, the consumption of tea is so widespread in Pakistan that it possesses 3rd position in the tea importing countries of the world, and is only behind the United Kingdom and Russian Federation. The already high tea consumption level may further increase in future due to urbanisation and increase in per capita income.
                                                                                                                             
TABLE-1: QUANTITY AND UNIT

VALUE OF TEA IMPORT

Year Qty /000 kg Unit Value/Rs/kg

1997-98 98,649 99.52

1998-99 119,695 93.15

1999-00 108,644 100.27

2000-01 111,867 107.54

2001-02 99,396 96.69

2002-03

(July-March) 83,040 93.53

Tea is Pakistan's favourite hot beverage. Although efforts have been made to cultivate tea in the mountainous areas, the projects could not achieve the desired results. Under this scenario, tea imports rose from approximately US$ 120 million in 1998-99 to US$210 million in 1999-00, showing an increase of over 65 per cent. Its imports were US$173 million in 2002-03. In rupee term, imports increased from Rs348 million, in 1990-91, to as high as Rs1, 8754 million in 1998-99. However, the imports decreased to some extent, and reached Rs1,040 million in 2001-02. (See table-2)

     

TABLE-2: TEA IMPORT

Tea Imports Million Rs.

1990-91 348

1991-92 344

1992-93 336

1993-94 307

1994-95 971

1995-96 971

1996-97 512

1997-98 512

1998-99 1,854

1999-00 1,207

2000-01 1,097

2001-02 1,040

2002-03 July-April 881

2003-04 July-April 979

Discovered around 5,000 years ago, tea is generally considered the oldest prepared beverage. Whatever its colour (black, green, yellow or white, depending on how it has been processed), tea can be produced from three main varieties: camellia sinensiss, camellia sinensis assamic and camellia seinensis cambodiensis. When the tea tree grows under natural conditions, it is evergreen and can reach 10 to 15 meters, but when it is cultivated in gardens (the name given to tea plantation worldwide), its height is artificially limited to one meter in order to facilitate the pickers. Tea trees are grown mainly in tropical and subtropical regions with humidity of 70 to 90 per cent. Rainfalls must be abundant and regularly distributed throughout the year, with a yearly average of 1,500 to 2,500 millimetres.
                 
Production
                                                
                   
Leaves can be picked by hand or mechanically. Manual picking yields leaves of higher quality. Picking is generally done according to the maturity of the leaves (from the top to the bottom of the tree, as a rule), and three levels of quality can be distinguished:

* Imperial picking involves picking only the terminal bud (Pekoe) and the first leave.

* Fine picking involves picking the terminal bud and the first two leaves.

* Classical picking, the main technique used today, includes the terminal bud plus three to four leaves.

Because of the product's perishable nature, final processing must occur as soon as possible after the leaves are picked, and special care is required during transportation and storage. The average yield per hectare from 1990 to 2003 was around 1.2 metric tons, with yields in leading producing countries being 1.4 tons per hectare in Sri Lanka and 2 tons per hectare in Kenya. Black tea is the only kind of tea that is subject to international quality regulations. It is classified according to two main methods: orthodox and crushing/tearing/curling (CTC). Within both categories tealeaves are classified into sub-categories, with the best quality represented by the pekoe and the condition of the pekoe and the lowest by the dust of leaves.

Trade in tea

In some of the leading tea-producing countries, such as China, India, Iran, Japan and Turkey, most of the tea produced is consumed domestically. In some others - including Bangladesh, Burundi, Kenya, Malawi, Rwanda and Sri Lanka - exports are important.

The tea marketing chain typically resembles one of two models. The first one, used mainly by large trans-national companies, is vertically integrated, with one company managing all the steps, from cultivation on large estates (which is often highly mechanised) to processing of tea bags. The second model can be considered more "traditional". The tea is grown in smaller gardens, which are often owned by a co-operative of producers, and is then usually marketed by national boards, as in India, Kenya and Tanzania. The fair trade movement has had an impact on the tea trade. Several organisations, such as Fair-trade Labelling Organisations International (FLO), work to increase the prices paid to smaller producers in order to enable them to cover production costs and improve their living conditions.

Prices                                                   
                                                  

Tea prices are highly volatile. However, with the closing of the London Tea Exchange, it has become increasingly difficult to hedge price risks. Currently around 85 per cent of domestic production is sold through regional auctions; the balance is being supplied through forward contracts. In 2002-03, a packet of 200 grams was sold for Rs340. The per unit price in international market, however, has not increased as compared to an increase in local market, see table-1.

TABLE-3: TEA PRICES IN KARACHI

MARKET (LIPTON YELLOW LABEL)

250 grm/ Rs

Year Six Packet

1993-94 181

1994-95 210

1995-96 230

1996-97 285

1997-98 337

1998-99 341

1999-00 350

2000-01 364

2001-02 340*

2002-03 340*

* 200 gram packet



Tealeaves are sold mainly in tea bags in western countries and as entire leaves in the east. In the United States and the United Kingdom, instant tea, to which hot or cold water is added, is widely consumed, but globally this form of consumption remains negligible (2 to 3 per cent of world consumption). Tea is also used in medical and paramedical applications.

The share of tea import in food group was 11.11 per cent in 2002-03. The imports increased by 6 per cent only in one year, i.e., 2002-03 over 2001-02.Imports are mainly from Kenya and other African countries, while the two multinationals blenders import tea from Sri Lanka, Indonesia and Bangladesh. In addition, tea is smuggled into the country via the border areas of the NWFP and Balochistan. It is also smuggled to Afghanistan. Perhaps this is the reason that tea imports suddenly increased to three times in 1998-99 as compared to 1997-98.

TABLE-4: TEA IMPORT

Million Rs.

Year Value Unit Value (MT) %

2001-02 157 1575 --

2002-03 173 1597 6.0

Currently, Pakistan is predominantly a CTC tea market. However, it is felt that the tea consumer in Pakistan has a strong preference for Ceylon tea due to its superior quality. Seeing the scope of tea export, Sri Lanka is planning to enter in Pakistan's tea market, following the signing of a Free Trade Agreement (FTA) with Pakistan. Sri Lankan tea exporters are looking forward to the early signing of a FTA with Pakistan, as they immediately want to enhance their trade with their Pakistani counterparts.

After FTA Sri Lankan tea would have an advantage in terms of tariff and would be able to compete with all other CTC teas in the world. Sri Lankan exporters are quite aware of the Pakistani tea market and they are ready to compete with their closest rivals in CTC tea market, especially Kenya. Sri Lanka produces better quality CTC, but due to tariff barrier it was unable to penetrate Pakistan's market. Hence, Sri Lanka hopes that it can regain at least some part of its lost share of the global tea market. Pakistan was one of the leading buyers of Sri Lanka's tea in the 70s, along with UK, Egypt and Iraq.

The share of Sri Lanka tea in Pakistan started declining from about mid 1980s due to many reasons, foremost among them being lower prices offered by other supplier countries and a shortfall in Sri Lanka's tea production in the 80s. However, during 1980s, due to a special trading arrangement between Sri Lanka and Pakistan, Sri Lanka exported around 20 million kilograms (kgs) tea to Pakistan's market. It is hoped that in the light of the proposed FTA and recent reduction of the duty on imports of black tea in Pakistan, Sri Lanka may capture some part of its lost share.

SHARE OF TEA IMPORT IN TOTAL IMPORTS

Year (%)

1990-91 2.2

1991-92 1.9

1992-93 2.1

1993-94 2.2

1994-95 1.8

1995-96 1.4

1996-97 1.1

1997-98 2.2

1998-99 2.4

1999-00 2.0

2000-01 1.9

2001-02 1.5

Source: Economic Survey

Tea Introduction in Pakistan

Introduction
Tea (Camellia sinesis) is a common form of beverage being used in almost all over the world. The per capita consumption of tea is approximately 1 kg/annum. The tea requirements are met through imports from the tea producing countries. It is established that 140-150 tonnes of tea is being imported every year with a total cost of Rs.8.0 billion (approx.) which is heavy burden to the national exchequer. The demand for tea is growing year by year in the wake of high population growth. Thus there was urgent need to introduce tea cultivation in Pakistan.

Technology Development, Demonstration and Recommendation  Cultivation
The activities on tea cultivation in Pakistan were started as early as 1958 but could not prove successful which lead to the understanding that tea may not become a commercial crop in the country. However, PARC initiated efforts from 1976-77 and later invited Chinese Experts in 1982 and 1987-88 who surveyed the prospective areas for tea cultivation and identified about 64000 ha of land with good to moderate potential. Based on the encouraging reports, PARC established National Tea Research Station, which was later, upgraded to the level of Institute. Through the research efforts suitable varieties were identified, nursery-raising techniques developed, soil amendments worked out, management practices, pest control, inter cropping etc. were developed and plantation was established on 43 acres.
The crucial stage now was to popularize it with the farmers who were reluctant, as it has long gestation period, lack of credit and processing facility. They demanded a Buy Back Agreement before plantation, which could only be provided if the processing facility was available. Looking to this situation, a development project was approved and implemented at NTRI, which helped to undertake the tea development activities more vigorously to increase the area, which has now reached to about 525 acres. Nursery raising facilities have been established at Shinkiari, Swat and Battagram where to the tune of about 0.8 million saplings are produced every year for distribution to the farmers.
Processing
To utilize the raw material i.e. tealeaves, initially a Green Tea Processing Plant was established with a capacity of 50 kg green tea per day which was later shifted to Swat. However, looking to the maximum consumption of black tea in the country, plans were prepared for installation of Black Tea Processing Plant with a capacity of one ton Black Tea per day. This plant was inaugurated by the President of Pakistan on September 07, 2001. This plant is processing about 10 tonns black tea every year which is expected to increase with the availability of raw material from the farmers’ fields.

The Technology
On the basis of encouraging results obtained through the studies conducted at NTRI in terms of tea production a complete package of production technology has been developed for the farmers. This includes availability of saplings, nursery-raising techniques, planting methods, soil amendments, training, punning, fertilization, harvesting of tea leaves, insect pest and disease management and inter cropping practices.
Key References
Khan B. M and H. U. Shah. (2004). Introducing tea culture in Pakistan. Farming Outlook 3(4): 14-16
Waheed A., F. S. Hamid, N. Ahmad and B. M. Khan. (2002). An over view of tea plantation in Pakistan. Online Journal of Biological Sciences: 1(4) 495-498.
Reference : parc.gov.pk

Indian Loose Tea In Very Low Price

We are have regular indian black tea,the quality &  taste of the tea is just equal to any other TOP branded Tea of  PAKISTAN.We have thousands of kilogram & can deliver any where in PAKISTAN within 7days.And this is our promise that we would`nt disappoint you in quality & taste or not even in Price.

 

Rising New Trading Company "NEXT TRADING"

There is no country  in the world today which produces all the commodities it needs. Every country, therefore, tries to produce those commodities in which it has comparative advantage. It exchanges part of those commodities with the commodities produced by other countries relatively more efficiently. The relative difference in factor endowments, technology, taste etc., among the nations of the world have greatly widened the basis of international trade. The developed countries are generally exporting consumer and industrial goods to the developing world and import primary goods from them. The developing countries, depending upon their state of industrialization, are mostly exporting raw material and semi-finished goods and getting finished goods and services from the advanced countries. The low income countries are thus at a disadvantageous position. However, the main contributions of trade to economic development of the low income countries including Pakistan.

1st Look Of Our Company Logo