KOLKATA, September 3, 2011
Ahead of another round of wage talks scheduled for Sunday, the tea industry has cautioned that any unsustainable increase in wages may trigger another round of closures for some of the tea estates which have only recently resumed operations.
In a note prepared by the Consultative Committee of Plantation Associations (CCPA), the apex industry body, it has been pointed out that any attempt to try and equate the positions of the Dooars and Terai tea industry with that of Darjeeling would be disastrous.
Cost of production
The CCPA said that the cost of production in the plains of Dooars and Terai at around Rs.110/kg, left very thin margins since average price realisations were low for these teas. The average price of Darjeeling tea between January and August was Rs.17 higher against the average increase of Rs.4 a kg mustered by the teas from the plains. In 2010, Darjeeling tea prices stood at Rs.310 a kg against Rs.104 for teas from Dooars and Terai.
While this makes any comparison unfair, tea-growing region in the plains is also susceptible to wide climatic variations and severe pest attacks which adversely impact the industry's viability. “It is therefore important that the wage negotiations, being pursued now, take adequate cognisance of this and make efforts towards a settlement which is sustainable for the industry.
Noting that the current negotiations were at a critical stage, the CCPA said that the main impediment to a settlement appeared to be the unions' inability to appreciate the need to spread out the increase over the whole tenure of the three-year pact rather that an upfront-loading which may bring about closures.
The unions, the CCPA said, still wanted to start negotiation at Rs.90 per day citing Darjeeling which effectively translates to a Rs.23 increase over their present level of daily wages of Rs.67.
This would lead to a Rs.15 increase in per kg cost of production.
Source: http://www.thehindu.com/business/Industry/article2421332.ece
Ahead of another round of wage talks scheduled for Sunday, the tea industry has cautioned that any unsustainable increase in wages may trigger another round of closures for some of the tea estates which have only recently resumed operations.
In a note prepared by the Consultative Committee of Plantation Associations (CCPA), the apex industry body, it has been pointed out that any attempt to try and equate the positions of the Dooars and Terai tea industry with that of Darjeeling would be disastrous.
Cost of production
The CCPA said that the cost of production in the plains of Dooars and Terai at around Rs.110/kg, left very thin margins since average price realisations were low for these teas. The average price of Darjeeling tea between January and August was Rs.17 higher against the average increase of Rs.4 a kg mustered by the teas from the plains. In 2010, Darjeeling tea prices stood at Rs.310 a kg against Rs.104 for teas from Dooars and Terai.
While this makes any comparison unfair, tea-growing region in the plains is also susceptible to wide climatic variations and severe pest attacks which adversely impact the industry's viability. “It is therefore important that the wage negotiations, being pursued now, take adequate cognisance of this and make efforts towards a settlement which is sustainable for the industry.
Noting that the current negotiations were at a critical stage, the CCPA said that the main impediment to a settlement appeared to be the unions' inability to appreciate the need to spread out the increase over the whole tenure of the three-year pact rather that an upfront-loading which may bring about closures.
The unions, the CCPA said, still wanted to start negotiation at Rs.90 per day citing Darjeeling which effectively translates to a Rs.23 increase over their present level of daily wages of Rs.67.
This would lead to a Rs.15 increase in per kg cost of production.
Source: http://www.thehindu.com/business/Industry/article2421332.ece