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Indian tea growers switch to electronic auctioning
Monday, 10 February 2003, 20:30 IST
CHENNAI: Electronic tea auctioning is the latest mantra of planters in India who saw a slump in business last year.
Three southern tea trade associations have adopted new guidelines for auctioning tea in India. State-managed tea cooperatives are also going in for the electronic auction system.
The government's Tea Marketing Control Order (TMCO) 2003 is supposed to eliminate the distortions of auctioning centres scattered throughout northeastern and southern tea producing areas.
In the southern hills, a kilogram of tea costs 
65 to produce but at auctions last year it never got over 45 a kg, resulting in heavy losses to cultivators.
Last year, tea production all over India declined sharply, the United Planters' Association of Southern India (UPASI) said.
Throughout northern and northeastern states, including in Assam, tea production has declined by 19 million kg. In the southern states, especially in Kerala, the drop in production is nine million kilograms.
This sharp drop in production is due to the poor prices tea fetched at auctions last year.
But, N. Dharmaraj, chairman of UPASI, says: "The new system of auctions has already started showing results. Auction centres at Coimbatore, Coonoor and Kochi have adopted the more uniform TMCO rules."
In auctions on February 6 at Coonoor, nearly 1.5 million kg of tea was offered and over 300,000 kg was lifted immediately. From the 300,000 kg of dust tea in the market, 200,000 kg was sold. Of the 200,000 kg of leaf tea, over 100,000 kg was lifted.
On February 7 at the Coimbatore auction, nearly 400,000 kg of tea was lifted. Implementation of the new rules saw a price gain of up to 3 per kg, UPASI officials said in a press release.
The first auction under new rules in Kochi is taking place on Monday and Tuesday. UPASI said that tea trade associations and auction committees in Guwahati, Siliguri and Kolkata would be implementing the new system in their next auction.
The tea board has licensed an electronic tea auction system to Indcoserve, the state-managed body for cooperative tea factories in Tamil Nadu.
The system, called Teaserve, was started from January 31. It is controlled by the Producers Cooperative Society. It was first used at the Coonoor auction last week.
Any buyer can register and participate in the online auction. Teaserve will evaluate samples and accordingly advise producers on market trends.
"The electronic auction ensures complete transparency in auctions," says Indcoserve director T. Udhayachandran.
Flavours and quality of 1,000 samples can be determined and matched with existing market trends for a single auction, something that was not manually possible ever before. The grading is electronic and the superiority of the sample is decided electronically.
The first bidding server is located at Coonoor and connected through a LAN network.
The display screen at the auction centre can show catalogues containing 250-1,000 samples at a time, on an hourly basis. "This provides reasonable time for price realisation", officials said.
The system will get operational in the coming weeks. Once the Coonoor online auction system is perfected, similar electronic auction servers will be set up in Coimbatore, Tiruchirapally and Ahmedabad, Udhayachandran said.
The tea board hopes to cover the entire country's tea auction electronically in the next few years, so that prices can be tracked and a uniform price for a quality range ensured for producers throughout the country.
Source: IANS
65 to produce but at auctions last year it never got over 45 a kg, resulting in heavy losses to cultivators.
Last year, tea production all over India declined sharply, the United Planters' Association of Southern India (UPASI) said.
Throughout northern and northeastern states, including in Assam, tea production has declined by 19 million kg. In the southern states, especially in Kerala, the drop in production is nine million kilograms.
This sharp drop in production is due to the poor prices tea fetched at auctions last year.
But, N. Dharmaraj, chairman of UPASI, says: "The new system of auctions has already started showing results. Auction centres at Coimbatore, Coonoor and Kochi have adopted the more uniform TMCO rules."
In auctions on February 6 at Coonoor, nearly 1.5 million kg of tea was offered and over 300,000 kg was lifted immediately. From the 300,000 kg of dust tea in the market, 200,000 kg was sold. Of the 200,000 kg of leaf tea, over 100,000 kg was lifted.
On February 7 at the Coimbatore auction, nearly 400,000 kg of tea was lifted. Implementation of the new rules saw a price gain of up to 3 per kg, UPASI officials said in a press release.
The first auction under new rules in Kochi is taking place on Monday and Tuesday. UPASI said that tea trade associations and auction committees in Guwahati, Siliguri and Kolkata would be implementing the new system in their next auction.
The tea board has licensed an electronic tea auction system to Indcoserve, the state-managed body for cooperative tea factories in Tamil Nadu.
The system, called Teaserve, was started from January 31. It is controlled by the Producers Cooperative Society. It was first used at the Coonoor auction last week.
Any buyer can register and participate in the online auction. Teaserve will evaluate samples and accordingly advise producers on market trends.
"The electronic auction ensures complete transparency in auctions," says Indcoserve director T. Udhayachandran.
Flavours and quality of 1,000 samples can be determined and matched with existing market trends for a single auction, something that was not manually possible ever before. The grading is electronic and the superiority of the sample is decided electronically.
The first bidding server is located at Coonoor and connected through a LAN network.
The display screen at the auction centre can show catalogues containing 250-1,000 samples at a time, on an hourly basis. "This provides reasonable time for price realisation", officials said.
The system will get operational in the coming weeks. Once the Coonoor online auction system is perfected, similar electronic auction servers will be set up in Coimbatore, Tiruchirapally and Ahmedabad, Udhayachandran said.
The tea board hopes to cover the entire country's tea auction electronically in the next few years, so that prices can be tracked and a uniform price for a quality range ensured for producers throughout the country.
Source: IANS