Financial Daily from THE HINDU group of publications
Tuesday, Jun 04, 2002
Sops on tea shipments through Amingaon ICD to continue
KOLKATA, June 3
THE transport subsidy on tea shipments through the Amingaon (Guwahati) inland container depot (ICD) is likely to continue in the current financial year also, according to tea industry sources.
The subsidy at the rate of Re 1 per kg of shipment routed through the ICD was introduced in January this year for three months till March.
It is now learnt that the subsidy will be extended till March 2003.
The tea shippers have asked for a raise in the subsidy rate to Rs 1.70 per kg.
It is of course not yet known if the demand will be conceded.
The subsidy is meant to cover, at least partially, the additional cost incurred by the tea shippers for undertaking shipments through the ICD.
Meanwhile, the current year's tea shipment through the ICD started about a month ago, though the shipping lines participating in the ICD do not seem greatly enthusiastic about the prospective volume during the whole year.
Last year's total shipments of around 2,000 TEUs were less than the previous year's 2,335 TEUs and much less than what was initially estimated (2,500/2,600 TEUs) at the beginning of the year.
Last year, the first shipment took place towards the third week of May; this year it was May 9, i.e. nearly two weeks earlier, yet the shipping sources are not attaching much importance to the early start of the shipment this year vis-a-vis last year.
This is presumably because this year's shipments so far have been largely the spillovers of the last year's production.
The bulk of the ICD shipments goes to the UK/Continent and it is generally the second flush crop which is used for such shipments.
The second flush crop is just beginning to arrive. Also, the shipments so far have been restricted to the non-UK destinations, mainly Russia.
Between May 9 and now, a total of three rakes have passed through the Amingaon ICD, carrying about 100 boxes to Haldia dock for onward movement, the shippers so far being George Williamson and Eveready, the two major participants in the ICD. Regular shipments, the industry sources feel, will start from end June/early July.
Stung by last year's experience, the shipping lines are unsure of the prospect of this year's throughput at the ICD, more so because the tea shippers were unable to give an estimate of the probable volume of throughputs at the ICD at the annual tea workshop held at Guwahati in the first week of April.
However, inquiries with the industry reveal that this year's export prospect is good, thanks to the crop loss in major tea producing countries.
Between January and March this year, Kenya, one of the largest producers of tea and India's competitor, has suffered a drop in production to the tune of 13 million kg or roughly 16 per cent of its production.
During the same period, Sri Lanka, another major competitor, suffered a production loss of about seven million kg, India six million kg and Malawi one million kg, the total drop in the major tea producing countries being around 29 to 30 million kg.
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