However, production loss and rising input costs are just one side of the coin. Assam raised daily wages by Rs 50, to Rs 202, while West Bengal raised it by Rs 26, also to Rs 202. Votes of tea labourers, who are sizable in numbers, play a crucial role in many pockets of these two states. Then came the wage hike by both the state governments, just before the Assembly polls in the tea-growing states. These two states produce the major share of the beverage in the country, almost 75 per cent of the total.Īlso Read - Slump in tea prices may hurt India's overall industry: Tea Association Later, floods in some key tea growing regions of Assam and West Bengal also damaged crops and reduced yields. The leaves mature if they are left on the shrubs for too long, leading to deterioration in the quality of tea.
The rise in tea costs was led by the pandemic-led disruptions in the plucking activities, initially. The rest goes for coal, gas, fertiliser, and other machinery. Tea production is a high-cost business, with 60-65 per cent of the input costs going into labour wages.
The perfect storm in the cost-intensive tea industry is expected to spill over into 2022, as concerns over rising tea prices as well as subdued export demand continue to hurt producers.
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