Right price hope for small tea growers - Centre tells bought-leaf factories to sell 70 per cent of tea in auctions

AVIJIT SINHA, TT, Siliguri, May 26: The Union ministry of commerce and industries has said bought-leaf factories should sell at least 70 per cent of their produce through tea auction centres, which would mean that for the first time small growers in north Bengal's tea sector would get to know the price of their produce in the market.

Small growers sell the unprocessed leaves from their gardens to bought-leaf factories (BLFs), which till now were free to sell the tea after processing to anyone - mostly through private channels and some quantity through auctions.

The grouse of the small tea growers was that they never came to know the correct price that their leaves fetched in the market as the BLFs controlled the transaction with the buyers. A persistent complaint by the small growers is that the BLFs never tell them the correct price that the produce had fetched, and they were cheated in the process.

But if sold through auctions, the small growers would come to know the price at which their tea sold as it would be recorded at the auctions.

The notification issued on May 15 mentioned an amendment has been made in the Tea Marketing Control Order, 2003. One of the clauses mentioned that "every registered bought-leaf tea factory shall, on and from the date of commencement of the Tea (Marketing) Control Amendment Order, 2015, sell not less than 70 per cent of the total tea manufactured in a calendar year through public tea auctions in India".

A green leaf price monitoring committee would be set up according to the order. It will have two representatives, one each from BLFs and growers, and an officer of tea board. The district magistrate will function as the ex-officio chairman of the committee.

The committee will monitor the average green leaf price payable to small tea growers for each succeeding month based on the last month average auction price fetched by the BLF and will also see that the growers are being paid the right price.

The price sharing formula specifies that small tea growers are entitled to receive 58 per cent of the price realised by selling a kilo of processed tea, while BLFs would keep the remaining 40 per cent.

So far, only a few BLFs were selling some of their tea through auctions.

"The majority of the BLFs have been selling their teas through private channels. Such private sale would often lead to protests among small tea growers, who would allege that the BLFs were not paying them adequately and that there is lack of transparency in prices," a planter based in Siliguri, said. "Often, the prices of tea leaves go down and growers resort to protests as the price of a kilo of tea leaves would not even cover their costs."

He said: "The new mechanism would help growers to have a clear idea about selling prices."

But BLF owners are unhappy.

"It is an open market and we, being tea producers, should have the liberty to sell our produce at any place across the world," Prabir Seal, the advisor of North Bengal Tea Producers' Association, said today.

"The notification has left us wondering as why the Centre is insistent on sending our tea to auctions. We have already spoken with our counterparts in Assam and south India and have submitted a memorandum to the Union minister of state for commerce and industry, requesting her to consider the situation and revoke the directive. If the Centre and the tea board still insist on adhering to the notification, we might approach the judiciary," Seal added.

In north Bengal, there are over 100 BLFs and over 30,000 small tea growers. The annual tea production from this sector is around 100 million kg, which is around 35 per cent of the tea produced in the region.