Undervalued and Overlooked: Tea Growers Urge Govt To Fix Broken Pricing System

Representing over 3 lakh small tea growers, CISTA appeals to the Centre to implement a transparent price discovery system, auction-based models, to ensure fair income amid rising production costs.

It said the Tea Board should undertake a detailed study to determine an equitable price-sharing ratio between small growers and factories.

Source : pexel

Kolkata, Jul 10 (PTI) Small tea growers, who contribute more than 50 per cent to the crop production of the country, have urged the Centre to set up a fair and transparent price discovery mechanism so that they can realise a proper value by selling leaves to factories.

In a letter to Commerce Minister Piyush Goyal, the Confederation of Indian Small Tea Growers Associations (CISTA) suggested a price protection scheme modelled on the lines of the minimum support price (MSP).

It said the Tea Board should undertake a detailed study to determine an equitable price-sharing ratio between small growers and factories.

Small growers are facing the persistent challenge of poor price realisation, which is undermining the sectors sustainability CISTA president Bijoy Gopal Chakraborty said.

Small growers contribute more than 52 per cent to the country's tea production, and a proper price realisation mechanism should be identified so that livelihoods are sustained: he said.

Chakraborty said : the association has already submitted a detailed status paper to the Commerce Ministry in May 2023, outlining the structural bottlenecks faced by the sector, which is suffering from chronic price realisation challenges.

He said : the concept of minimum benchmark price should be replaced by a new methodology linked to the total sales value so that growers receive a fair and remunerative price.

CISTA favoured the Sri Lankan model, under which surplus earnings over auction averages are shared equally between factories and growers.

Proposing a price protection scheme for small growers it said the average green leaf price currently ranges between Rs 22 to Rs 25 per kg while the cost of production is hovering between Rs 17 and Rs 20 per kg.

The yield on a modest margin is Rs 5 per kg for the growers, it said.

On the other side agents typically charge Rs 2 per kg the CISTA said it is a big disincentive and growers should be able to sell directly to factories. 

(This report is published as part of the auto generated syndicate wire feed.Apart from the headline,no editing has been done in the copy by ABP Live.)