FUTURE OF TEA PRICES

Press, Volume LXXXIII, Issue 25085, 17 January 1947, Page 8

FUTURE OF TEA PRICES

HIGH CALCUTTA SALE RATES

“ The Press ” Special Service AUCKLAND, January 16. The future of tea prices is causing increasing concern among local blenders. Fears of much higher prices have not been allayed by the first Calcutta public auction of teas for export since controls were lifted. This was held on January 7. and extraordinarily high prices ruled, levels which, if maintained, would place tea in the luxury class. Common teas were sold up to 6s per lb c.i.f. and e., and medium broken orange pekoe with tips went to 9s lOd per lb c.i.f. and e. Comparable prices before the war were 9d and Is 4d per lb respectively. In the days before controls came into operation Ind.an teas were not bought for the New Zealand market for straight-out consumption as much as for blending purposes. The bulk of these purchases were made by southern blenders. Most of New Zealand’s tea requirements, however, are supplied from Ceylon, and recently shipments to the Dominion under the system of international allocation with the United Kingdom as the sole buyer have been fairly substantial. The Ceylon Government has announced that free tea auctions will be resumed in Colombo on Monday, and with the Calcutta prices as an indication it is expected that prices will soar to very high levels. Australia, South Africa, and the United States have announced their intention tc buy tea through ordinary commercial, channels, but Britain, which has been in negotiation with the Ceylon Government on the question, has not yet declared its policy. This' is to be announced in an official Statement in the House of Commons this month. Although New Zealand’s position is still uncertain, it is expected that the Dominion’s supplies will be involved in the course taken by Britain. The Ceylon Government recently announced its intention to levy an export duty on tea after the first few auctions. This move, it is stated, is closely bound up with the virtual subsidy of 5 cents per lb involved in the Government’s decison to buy rubber at a "floor” price of 56 cents per lb on the local market, where the -free price is around 60 cents. It has been estimated that the subsidy wotfld, on that basis, represent a charge an the Government at the rate of 12,000.000 rupees a year (over £N.Z.1.000.000). The Government’s intention is to recoup itself for the subsidy from the export tax on tea. This is intended to be a temporary measure, but tea producers are not relishing the prospect that their expected gains will be diverted to support the rubber industry. Mining Quotations. —Quotations listed in London, are:—North Broken Hill. 55s 6d: Broken Hill Pty.. 36s 3d; Zinc Corporation. 99s 4Jd; New Broken Hill. 33s 9d: Mount Morgan. ss; Emperor. 13s. 4jd.