The tea industry has urged the Centre for declaration of floor price for green leaf and other varieties, with planters in West Bengal facing stagnating prices and increasing financial stress, the Indian Tea Association (ITA) said.
The introduction of a floor price would be an immediate solution to address the "unremunerative price" of tea without any additional cost to the government, it said.
"The industry has proposed to the Ministry of Commerce, Government of India for declaration of a floor price for green leaf (payable to small tea growers) and made tea (payable to tea producers) indexed to cost of production," the ITA said in a statement on Tuesday.
The West Bengal government has supported the proposal for introduction of a floor price for tea, it claimed.
"The Department of Industry, Commerce & Enterprises, Government of West Bengal has written to the Union Commerce Ministry to consider the floor price proposal favourably.
"The government of Assam has also extended its support to the proposal and has requested the Union Commerce Ministry to grant in-principle approval," ITA, which represents large tea makers, said.
There is an urgent necessity for mitigating the escalating costs to ensure the continued sustenance of the tea industry, it said.
The West Bengal tea industry, particularly Darjeeling planters, has been going through a period of acute financial crisis over the last few years with prices not able to keep pace with the rising cost of production, it said.
West Bengal tea prices since 2014 have grown at a CAGR (compound annual growth rate) of around 4 per cent, while costs of vital inputs, such as coal, gas and sulphur, have grown at a CAGR of 9-12 per cent during the same period.
With the state labour department holding talks with tea garden owners and trade unions to finalise the minimum wage for plantation workers, the ITA said an increase in wages will further aggravate the financial stress of tea producers and make estate operations unviable in West Bengal.
Tea workers in the state receive Rs 232 a day. The wage was last revised in June 2022.
"Wages of tea plantation workers have increased substantially since April 1, 2014 -- from Rs 95 per day to the present Rs 232 per day, an increase of 144.21 per cent," the industry body said.
The new tea season has not begun on a bright note for the West Bengal tea industry with unfavourable weather conditions "adversely impacting crop in several tea-growing pockets in Dooars and Darjeeling", the statement said.
According to ITA data, the Darjeeling crop is estimated to be down by 39 per cent in March. The decline has also been reported in several pockets in the Dooars region.
