Market Report – Week 42 (28 November 2024)

Mombasa Auction:
- Offerings & Prices: 157k packages were on offer, with 54% sold. The average hammer price declined by 4 USC to close at USD 2.09/kg.
- Grade Trends:
  - Best and better BP1s continued to see strong demand at firm to dearer levels.
  - Flavoury Rwandan BP1s were highly sought after, with some nearing the $7.00 hammer mark.
  - Kenyan brokens traded irregularly steady to easier, with some marks losing value compared to the previous week.
  - KTDA EoR PF1s shed 10-20 USC, while KTDA WoR PF1s dropped 40-50 USC.
  - Medium PF1s held steady for better quality marks, while the rest traded irregularly easier.
  - Rwandan PF1s saw selective demand, while Burundi PF1s remained firm to dearer.
- Weather & Crop:
  - Weather conditions remained favorable with rainfall recorded across key regions such as Kericho, Nandi, Nyeri, and Sotik.
  - Crop intakes improved slightly, with expectations for increased production as temperatures rise.
- Market Outlook:
  - Auction volumes are gradually increasing, with Sale 44 offering 173k packages compared to Sale 43 at 159k.
  - Price volatility is expected, with high-quality teas maintaining value while others trend easier.

Blantyre Auction:
- Offerings & Prices: 157k packages were offered, up from 151k last week, with improved absorption in the M4 auction.
- Grade Trends:
  - BP1s saw strong demand, particularly in Rwanda, where premium invoices commanded high prices.
  - PF1s experienced mixed trends, with better Kenyan PF1s shedding value, while Rwandan and Burundi teas remained firm to dearer.
  - PD and D1 grades held steady with improved absorption.
- Weather & Crop:
  - Rainfall arrived late in the week, with expectations for further precipitation.
  - Crop intakes remained steady, supporting strong third-quarter output.

Uganda: Steady demand but trading at steady to easier rates.
Rwanda: Continued strong demand, especially for bright liquoring teas.
Burundi & Tanzania: Smaller volumes were offered, with firm pricing for better grades.

Colombo Auction:
- Offerings & Prices: 5.38 million kgs were offered, with a bearish trend prevailing.
- Grade Trends:
  - Ex-Estate Teas: Best BOPs eased by USC 8, while BOPFs gained USC 15.
  - Nuwara Eliya: BOPs declined by USC 20, and BOPFs remained unsold.
  - CTC: Low-grown PF1s shed USC 10-15, while high and medium PF1s declined by USC 10-15.
  - Medium Grown Teas: OP1s remained firm, while BOP1s shed USC 10-20.
  - Low Grown Leafy & Small Leaf Teas: OP1s gained USC 25, while BOP1s declined by USC 10-20. FBOPs and FF1s eased by USC 10-20.
  - Dusts: High-grown dusts gained USC 10-15, while secondary dusts declined by USC 10-14.
Market Outlook:
- Buyers remained selective, favoring premium quality teas while lower grades faced resistance.
- With production expected to increase in the coming weeks, a market rebound is uncertain, and prices may settle lower in the near term.

North & South India:
- Strong demand was observed for 5,080 packages, with only 1% remaining unsold.
- A significant cancellation of 2,500 packages just before the sale led to firm pricing for Java/Sumatra Orthodox teas.
- Low to medium BOPF/PF and secondary/offgrade teas saw demand from local buyers and blenders.
- High-grown Java BOPF/PF traded firm to dearer.

Jakarta Auction:
- Offerings & Prices: 7,580 packages were initially planned, but 2,500 were withdrawn, leading to firm to dearer prices.
- Weather & Market Outlook:
  - Sunny but cool conditions prevailed, with higher humidity levels.
  - Demand remains sluggish, with processors stockpiling green leaves for quick shipments once demand increases.

Production & Market Trends:
- Heavy rains have impacted production, with tea plucking affected in some regions.
- Factories are adjusting by relying on stored stocks and cautiously managing supply.

Supply & Demand:
- The market remains volatile, with selective demand prevailing across regions.
- Sri Lanka and India are seeing a correction phase, while Kenya and Malawi maintain stable pricing for quality teas.
- Auction volumes are increasing, but absorption rates remain a concern in some markets.
Pricing Trends:
- High-quality teas continue to command strong prices, while lower grades face downward pressure.
- Weather conditions are expected to support increased production, potentially stabilizing supply in the coming weeks.
Logistics & Shipping:
- Shipping delays and container shortages remain a challenge, affecting tea movement from East Africa and South Asia.

The tea market continues to navigate fluctuating demand, with high-quality teas holding value while bulk grades experience pricing adjustments.

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