Forbes and Walker, one of the oldest and most respected tea brokers in the country, has highlighted the fall in the Colombo tea sale averages at the last auction. In a market report, Forbes also drew attention to the fact that the auction sale average last week was for the first time this year below that of the corresponding auction last year.

"The total auction average (last week) at Rs. 125.27 is sharply lower than the previous week's average of Rs. 133.86 and for the first time this year is also below the corresponding average last year of Rs. 126.35,'' the report said.

The low grown average had taken the biggest beating in the absence from the sale of Russia and the other CIS countries, Forbes said. This average had fallen to Rs. 135.21 from Rs. 149.05 the previous week.

"Further, probably for the first time this year, the weekly auction average for low growns fell below the average of the corresponding sale last year which was Rs. 140.21,'' the report said.

Forbes made the point that the average prices are "all the more disappointing'' given that the quantity of tea sold at the Sept. 2 auction was only 3.8 million kg. against 5.7 million kg. sold at the corresponding sale last year.

Also, the rupee has depreciated 10% against the dollar within the last year, the brokers noted.

Only the high grown average last week was marginally ahead of the previous week, Rs. 109.50 against Rs. 108.99 a week earlier. This was attributed to a higher average for western high grown teas. But even so, the high grown average last week of Rs. 109.50 was down from the Rs. 113.30 attained at the corresponding sale last year.

The mid-grown average of Rs. 107.56 last week was down from Rs. 113.85 a week earlier and also below the average attained at the corresponding sale last year which was Rs. 114.13.

Forbes also said that they were awaiting more details about the tariff applicable to tea imports to India following the lifting of import restrictions from SAARC countries effective Aug. 1. Previously, when tea imports were subject to license, a 10% tariff was applicable as and when limited imports were permitted into the Indian markets.

Forbes' Cochin corespondents have advised that in addition to this 10% duty, a countervailing duty which has not been finalised will also apply. A figure of 9.5% is being mentioned in this regard.