Market Report – Week 3 (17 January 2025)

African Markets

Kenya – Good General Demand

• Mombasa Auction:

  • Offerings & Prices: 178k packages were offered, with 24% (42k packages) remaining unsold. The average auction price dropped by 1 USC, closing at USD 2.13/kg.

  • Grade Trends:

    • BP1s: Flavoury KTDA EoR BP1s continued to attract strong demand, selling at firm to dearer levels. Below-best BP1s were steady to firm. KTDA WoR BP1s saw steady demand, trading at firm to dearer levels. Medium and plainer BP1s followed a similar pattern, with improved demand.

    • PF1s: KTDA EoR PF1s were firm overall, with the best types maintaining prices while others traded irregularly steady to easier. KTDA WoR PF1s saw quality types move dearer, while the remainder traded steady to easier. Medium PF1s started easier but firmed up towards the close. Plainer PF1s met good demand, selling firm to dearer.

    • Dust Grades: Best PD & D1 traded irregularly steady to easier. Medium and plainer PD/D1s found strong demand from Egyptian packers, UK, and Pakistan, selling firm to dearer.

  • Active Markets:

    • Pakistan remained the strongest buyer.

    • Sudan, UK, Egyptian packers, Afghanistan, Yemen, Kazakhstan, and Russia were active.

    • Other CIS countries and China were slower.

  • Weather & Crop:

    • East of Rift (EoR): Becoming drier and hotter, leading to a gradual decline in crop harvest.

    • West of Rift (WoR): Still experiencing favorable weather.

    • Outlook: Crop intakes expected to improve in upcoming auctions due to double collection from previous missed sales.

  • Market Outlook:

    • Demand for quality teas will hold, while others may ease.

    • Market direction will be influenced by KTDA’s handling of unsold teas, which appear to have reduced.

Malawi – Weaker Demand

• Blantyre Auction:

  • Offerings & Prices: 3,320 packages were offered, with subdued demand.

  • Grade Trends:

    • BP1s saw good demand at steady rates.

    • PF1sc met selective demand at steady levels.

    • PF1 seedlings were neglected.

    • PDs and off-grade fannings had limited interest.

    • D1s saw no interest.

  • Weather & Crop:

    • Isolated rainfall reported in Mulanje and Thyolo, followed by hot and dry conditions.

    • Cup quality remains good, but leaf quality still needs improvement.

    • Crop intake showed a slight improvement, but more rain is needed for substantial recovery.

Other African Markets

• Uganda: Strong demand, particularly for brighter liquoring teas, with firm to slightly dearer prices.

• Tanzania: Improved demand, with auction volumes increasing.

• Rwanda: Brokens rebounded with improved demand; other grades remained irregular.

• Burundi: Limited availability, with improved demand at firm to dearer levels.

Asian Markets

Sri Lanka – Strong Demand

• Colombo Auction:

  • Offerings & Prices: Strong market with steady demand across most grades.

  • Grade Trends:

    • Ex-Estate:

      • BOPs eased by 5-10 USC.

      • Better BOPFs gained 5 USC, while others were lower by 5 USC.

      • Nuwara Eliya BOPs dropped 30 USC.

      • Uva BOPs declined by 3 USC, and BOPFs dropped by 10-15 USC.

    • CTC:

      • Low-grown PF1s gained 6 USC.

      • BP1s remained mostly unsold.

      • High and medium PF1s dropped by 30 USC.

    • Medium Grown:

      • OP1s and BOP1s gained 15-20 USC.

      • FBOPs moved 10-20 USC higher.

      • FF1s remained firm.

      • OP/OPAs were steady to 4-8 USC dearer.

    • Low Grown Leafy:

      • Better OP1s gained up to 50 USC, while others increased 10-25 USC.

      • Better BOP1s gained 15-20 USC, while others moved 10 USC higher.

      • PEKs strengthened 10-15 USC, while some eased 10 USC.

    • Premium & Small Leaf:

      • FBOPs were dearer by 8-10 USC.

      • BOP/BOPFs eased by 8-10 USC.

    • Off Grades:

      • Better FGS1 gained 5-10 USC, while others remained firm.

      • BOP1As gained 8-10 USC.

    • Dusts:

      • High-grown dusts lost 10-14 USC.

      • Secondary dusts traded irregularly lower by 4-6 USC.

      • Low-grown better dusts gained 4-8 USC.

India – Steady Demand

• North & South India:

  • Offerings & Prices:

    • Last remaining North India teas saw strong sales.

    • Demand for export-quality Orthodox teas remains high.

  • Market Outlook:

    • Domestic demand is strong.

    • Quality teas are fetching premiums, indicating a willingness to pay higher prices.

    • Tea prices expected to remain firm, as supply remains under pressure.

Indonesia – Fair Demand

• Jakarta Auction:

  • Market Trends:

    • 7,700 packages were offered, with 24% remaining unsold.

    • Java/Sumatra Orthodox and CTC teas traded steady to easier.

  • Weather Impact:

    • Favorable conditions with daily rain and sunny spells.

Vietnam – Slower Production

• Market Conditions:

  • Production slowed due to heavy rainfall and flooded plantations.

  • Factories focusing on selling existing stock rather than fresh production.

Global Outlook

• Supply & Demand:

  • Demand remains steady, though quality teas continue to command premiums.

  • Buyers are adjusting to new supply levels, and the market may strengthen in February.

• Pricing Trends:

  • Stronger demand is supporting prices for high-quality teas.

  • Bulk grades remain under pressure.

• Shipping & Logistics:

  • Freight rates are slowly stabilizing, though container shortages persist.

The tea market remains active in early 2025, with strong demand for premium teas. Lower-quality grades may continue to face selective interest, but supply disruptions and demand from major markets will shape pricing trends in the coming weeks.