New Delhi, Sept 17 (UNI) Kolkata-based Duncans Tea Ltd today said the industry would see a price hike in the coming 2-3 months due to increasing packaging costs.
''Tea prices are likely to go up in the next 2-3 months as packaging costs have gone up considerably. Also, with the overseas demand growing, the domestic supply is likely to be affected, which might lead to price hikes,'' company Chief Operating Officer M C Appaiah told reporters here.
Packaging constitutes 15 per cent of the total cost of the final product The company has already hiked its prices three times this year, about four per cent each time, he added.
India contributes a major portion of the world's tea demand after Kenya and Sri Lanka. Due to the production shortfall in Kenya, the demand for tea has increased and India's tea exports for the January-July period this year has already increased 19 per cent.
Total exports during the said period was 105.6 million kg, compared with 88.9 million kg during the corresponding period a year ago. Production during the period increased 3.7 percent to 476.6 million kg.
Mr Appaiah said the challenge is also to stop people from turning to loose tea from packaged tea. ''Loose tea is about 30 per cent cheaper than packaged tea but lacks consistency. The challenge for the industry is to stop people from converting to loose tea and maintain the quality of the product,'' he said.
UNI SR AK HS1640