RETAIL PRICES OF TEA

Press, Volume XCI, Issue 27675, 3 June 1955, Page 14

RETAIL PRICES OF TEA

REPLY TO RECENT CRITICISM “COST DETERMINED BY WORLD DEMAND ” “As Ceylon, a sister Dominion of the British Commonwealth, earns more than 60 per cent, of its income from tea, and is trying to raise the over-all living standards of its people, is it justifiable in any respect to talk of ‘outrageous’ prices for tea and lower ceiling prices?” asked Mr K. A. H. Read, commissioner of the Tea Bureau representing the Ceylon tea industry in New Zealand and Australia, when he commented yesterday on criticism of present tea prices expressed by Mrs E. Taylor, secretary of the New Zealand Housewives’ Association.

“Tea is sold at public auctions, and fetches a price determined by world supply and demand, coupled with quality,” said Mr Read. “New Zealand buys in a quality market in Colombo, and no established New Zealand packer can ever be accused of profiteering or selling .tea in packets of inferior grade at top price.

“May I point out that the recent reduction in the price of packet teas will obviously cost the tea trade several thousands of pounds in losses on stock held by them of teas imported in the last three shipments, which were the highest-priced teas recorded in this century.

“I agree that it is human nature for housewives to buy heavy stocks when price rises are rumoured or suggested in the newspapers. This is exactly what happened in New Zealand, Australia, the United Kingdom, and elsewhere. Their purchases were far in excess of the half-pound weekly order which is normal for a family of four persons. “To meet this unprecedented demand, the grocer increased his orders and the packer his purchases at public auction. Thus the auction prices between November, 1954, and March, 1955, were kept at their highest level until saturation point was reached and retail purchases collapsed. Only these teas are to hand in New Zealand at present. “Until Tuesday of this week, when good quality teas increased in price by Is per lb, auction prices in Ceylon have been below production cost. Obviously such a situation cannot last, or we may naturally expect curtailment of supply through economic collapse of tea estates. Is this what Mrs Taylor seeks? I cannot believe that this is the case, and she is fortunate that tea pluckers do not earn as much in a week as an average New Zelandet earns in a day.” A rise or fall of Is per lb for tea meant Only lid a week for each person, and no-one could justify the statement that that sum was “a vitally important issue,” said Mr Read. A full year’s tea bill for an individual at 8s per lb was £3, and tea was the cheapest household commodity of quality in use each day. The misrepresentation and misinformed statements concerning tea were to no-one’s advantage, least of all the New Zealand consumer “who, thank goodness, is always looking forward to his next cup of good quality tea.”