New Delhi: 2022 will be a challenging year for the Indian tea industry as the cost of producing tea is higher than the actual price at auction, according to a report by Assocham and ICRA. Fiscal 2021 proved to be one of the best years for the Indian loose tea industry in recent years, but sustainability remains a key issue, the report said.

While Labour costs have risen and production has improved, per capita consumption in India has remained virtually stagnant, putting pressure on tea prices, the report said.

Manish Dalmia, chairman of Assocham’s Tea Committee, said the changing landscape required greater collaboration among stakeholders in the industry, with the most urgent issue being to raise consumption levels in India.

He also said the tea industry should pay more attention to the production of high-quality tea as well as traditional varieties accepted by export markets.Kaushik Das, vice president of ICRA, said price pressures and rising production costs, especially workers’ wages, had caused the tea industry to suffer. He added that increased production from small tea plantations had also led to price pressures and the company’s operating margins were falling.

About Assocham and ICRA

The Associated Chambers of Commerce & Industry of India, or Assocham, is The country’s oldest top-level chamber of Commerce, Dedicated to providing actionable insights to strengthen the Indian ecosystem through its network of 450,000 members. Assocham has a strong presence in major cities in India and around the world, as well as more than 400 associations, federations and regional chambers of commerce.

In keeping with the vision of creating a new India, Assocham exists as a conduit between industry and government. Assocham is a flexible, forward-looking organization that spearheads initiatives to enhance the global competitiveness of Indian industry while strengthening India’s domestic ecosystem.

Assocham is an important representative of Indian industry with over 100 national and regional industry councils. These committees are led by prominent industry leaders, academics, economists and independent professionals. Assocham is focused on aligning the critical needs and interests of the industry with the country’s desire for growth.

ICRA Limited (formerly India Investment Information and Credit Rating Agency Limited) is an independent, professional investment information and credit rating agency founded in 1991 by head financial or investment institutions, commercial banks and financial services companies.

At present, ICRA and its subsidiaries together form the ICRA Group. ICRA is a public company whose shares are traded on the Bombay Stock Exchange and the National Stock Exchange of India.

The purpose of ICRA is to provide information and guidance to institutional and individual investors or creditors; Improving the ability of borrowers or issuers to access money and capital markets in order to draw more resources from the broader investing public; Assist regulators in promoting transparency in financial markets; Provide intermediaries with tools to improve the efficiency of the fundraising process.