Major tea firms stare at crop loss due to Assam floods, pest attack

Incessant rainfall, floods, followed by pest attack in Assam, have taken a toll on the production of the premium second flush.

Nayantara Palchoudhuri, chairperson, Indian Tea Association (ITA), said the situation was grave in Assam Valley and Barak Valley. “It is a huge problem among our members. But the Assam government is doing its best and some of our member companies are also doing a lot of flood relief work individually.”

The ITA has assessed the impact in Barak Valley. “According to estimates, about 150 hectares were lost in landslide, 300 hectares of plantation was submerged for a week. Its mortality and impact will be known later. There was no work for a week in several gardens as roads and bridges were washed away,” Arijit Raha, secretary general, ITA, said.

“Our quick estimate indicates that the crop in June 2022 is lower by at least 20-25 per cent over June last year,” said Sujit Patra, secretary, exports & market promotion, ITA.

This year, April and May saw a record crop but much of the gains would have been wiped out during June and July.

“Till May, 45 mkg of crop was higher than last year. But all gains are lost now. Only in the second half of July, the crop is likely to be comparable to last year on a day-to-day basis,” Himanshu Shah, chairman, M K Shah Exports, said.

Shah said for the second half of June, his firm lost 22 per cent crop but for June, it was about 2 per cent higher as compared to 2021.

Other major tea producers have also recorded a loss in crop. Vikram Singh Gulia, managing director, Amalgamated Plantations Private Ltd (APPL) said in Upper Assam, considerable crop was lost.

“But we are spread out, so overall loss would be about 20 per cent.”

APPL was carved out of erstwhile Tata Tea to run plantations in North India.

Those who are only in Upper Assam, which is the larger basket, may have lost 30 per cent crop, Gulia pointed out, adding that helopeltis, a tea mosquito bug, and fusarium solani, a fungal disease, were adversely impacting the upcoming crop of 15-21 days.

McLeod Russel is estimating the loss to be about 20 per cent. “We are well hedged between North Bank, South Bank and a little bit of Dooars (West Bengal). So North Bank and Dooars have not lost that much. Also, our exposure to South Bank is not that high,” McLeod Russel director, Azam Monem, said. Parts of North Bengal have also been impacted by rains.

Goodricke Group Managing Director and Chief Executive Officer, Atul Asthana, said it had lost about 15 per cent crop during June vis-à-vis last year. “And the entire June is second flush period,” he pointed out.

That is a worry for planters in Assam. The premium quality second flush is a major revenue earner and producers are ruing its loss. Moreover, Indian tea producers have an export opportunity thrown up by the crisis in Sri Lanka   

Most of June, which is usually the prime second flush period, the quality was impacted, said Shah.

“Being the quality season, producers will face tremendous problems to meet workers’ wages and arrange for input materials where there is persistent increase in procurement costs and stagnancy in price realisations,” Patra said.

Patra said, looking at the present trend and persistent rains, floods in vast parts of Assam and North Bengal, this year, the crop will be heavily down even in July.

Last year, there was a record crop in North India during June and July. The total crop in June was 144 mkg and in July 158 mkg against an average of 120 mkg and 145 mkg, respectively.