TEA PRODUCTION

Taranaki Daily News, 13 December 1932, Page 11

TEA PRODUCTION

RESTRICTION WANTED. FIFTEEN PER CENT. PROBABLE. According to a leading importer of tea in Auckland, it appears more than likely that early in the New Year—in January or February—a restriction in the production of tea in Ceylon, India and Dutch East Indies, will become operative to assist the industry. These countries have been faced with the problem of over-production and falling prices for some time. In 1929 British and Ceylon producers effected a 10 per cent, reduction in output, but the Dutch, who had also undertaken restriction on the same basis, departed from the agreement. The position now is that, with Britain off the gold standard and Java on the gold standard, prices in the latter country have fallen so low that the Dutch have made overtures again for restriction of production, and the Indian and Ceylon producers have approved of a 15 per cent, reduction in 1933. The suggested term is five years, the quota to be adjusted yearly. The Auckland importer Said that the scheme had been proposed not so much with the idea of forcing up the prices of tea as keeping prices at the present level, so as to arrest the downward trend. The basis on which the reduction was to be made was to be decided by each country, and each would be free to select any one of the years 1929, 1930, or .1931 as its basic year. In the year ending November 1, there was an increase of production from India of 26,250,0001 b, Ceylon 10,750,0001 b, Sumatra 750,0001 b, while Java (estate interests) was 4,000,0001 b down. From the last figure it could ’be seen why the Dutch, who control the bulk of the tea production in Java, desired the restriction. The total amount of over-produc-tion, therefore, totalled 33,250,0001 b. In 1931’ the total amount of tea produced was 775,000.0001 b. A 15 per cent, reduction would mean a decrease of about 115,000,0001 b. The severity of the fall m prices which had taken place in the last two years was vividly illustrated by the averages realised in London for all tea sold on garden account during JanuarySeptember. These were: 1929, Is 4.82 d; 1930, Is 314 d; 1931, Is 0.08 d; 1932, 9.47 d. The importer said that practically only the cheap teas were now being consumed.