Cuppa
Of Woes Brimmeth Over
By K A Shaji/
Udhagamandalam
16 June, 2007
Countercurrents.org
The
tea industry in India is now on the road to recovery. However, the slow
increase in prices and the growing demand across the globe are yet to
be reflected in the faces of thousands Tamil repatriates and refugees,
who work in tea plantations in Nilgiri hills. Tantea, one of India's
major tea producers and the biggest rehabilitation project meant for
Tamil repatriates from Sri Lanka, is already in crisis due to accumulating
losses. Many of the private plantations and small farms of average farmers
are also in the same predicament. Collapses of the former Soviet market
and an indifferent attitude to quality have landed the tea industry
here in the difficult situation.
``As many as 4431.92 hectares
of dense forests of Nilgiris were cleared for the rehabilitation project
meant for repatriates, who were trained only in tea plantation works.
The destruction of the forests had caused enormous damage to the environment
including climatical change. But now it seems neither the repatriates
nor the environment benefited out of the loss making project,'' points
out K.Jayachandran, an activist of Tamil Nadu Green Movement.
The number of repatriates
in Nilgiri would come around half a million. But Tantea (Tamil Nadu
Tea Plantations Corporation Limited) has succeeded only in rehabilitating
about 2,445 families so far. The existing crisis in tea sector has virtually
eclipsed the chances of survival of these privileged families as well.
Leave alone the survival struggles of the remaining majority, who works
in private plantations without even having minimum wages and protection
under labour laws. Apart from the instability in prices, shortfall in
the green tea leaf yield also making the survival of Tantea miserable.
Absence of replantation in time and the official hurdles in releasing
funds for ensuring better care are the main reasons behind the lack
of expected green tea leaves.
There are worry lines all
over the face of M Vasu, a small tea grower in the Nilgiris and a trade
unionist working among the repatriates and refugees. ``The prices have
started improving only now and the process is very slow. It is happening
after several years of cataclysmical fall in tea prices. So who would
compensate for the accumulating loses since the middle of nineties?''
he asked.
As many as 89,000 hectares
of land in the famed blue hills, which amounting to 80 per cent of the
cultivable area, is under tea cultivation. Of that, 42,000 hectares
are cultivated by small farmers.
"The average holding
of a small tea-grower is estimated to be around 0.6 ha," says Vikram
Kapur, executive director Tea Board, Coonoor. These small growers are
selling their tea leaves to the local tea leaf processing factories
which make the famous Nilgiri tea and sell the 'made tea', at auctions.
Both big plantations and small growers are availing the cheap labour
of Tamil repatriates and refugees to pluck the tea leaves. Each worker
gets a maximum of Rs 50. Though such a cheap labour is available, tea
cultivation is not profitable in the hills at present.
Four kgs of green tea leaves
are needed to make a kg of 'made tea'. The price paid to the farmers
for the leaves is determined in auctions in a backward flow. For instance,
if 1 kg of made-tea realises Rs 33 at the auction, the factories take
Rs 15 and the remaining Rs 18 goes to the tea-farmer (who thus gets
Rs 4.5 per kg of leaf). Of the 200 million kg tea produced annually
in South India, 75 million kg is supplied by the Nilgiris small farmers.
So, the instability in prices and the climatical changes that hinder
the yield are worsening the living conditions of both workers and farmers.
There was a time when it
seemed that things could go no wrong. Those were the 1980s — the
Nilgiris tea industry thrived on the demands of the erstwhile Soviet
market. "It didn't really matter to the Soviet market that the
tea when infused in water produced good liquor or a good flavour,"
explains Kapur. So, manufacturers in the Nilgiris started producing
teas, which sold well in the Soviet Union but would not be accepted
elsewhere, including a bulk of the Indian market. The Soviet demand
in fact led Nilgiri tea producers to shift from the orthodox variety
of tea to the crushed, torn and curled (CTC) variety. (CTC tea is produced
by crushing the leaf in a rottervane, while in the orthodox method,
leaf is rolled in a roller. CTC tea brew is bright and its liquors are
bright and strong — even when there is no quality in the leaves.
On the other hand, the premium orthodox tea gives more flavour and a
light cup. Hence, it can be made only with fine leaves. This tea is
aimed at the discerning customer.)
Moved by the demand from
Soviet Union, the government came forward with large incentives. Says
Bhojan, "The Tea Board and the United Planters' Association of
South India (UPASI) offered us Rs 15,000 per acre to convert from vegetables
to tea". Growers also recall that they were paid a subsidy of 50
paise per tea sapling planted — so they had to spend just 50 paise
per sapling themselves. The boom coincided with a disease, which hit
potato cultivation. So many a Nilgiri farmers converted enthusiastically
from vegetables to tea.
Predictably, the government's
calculations went totally awry. Indian tea exports to the Soviet Union
were governed by a special bilateral trading arrangement called the
rupee trading system, which allowed payments in non-convertible currency.
The collapse of the Soviet Union led to a termination of this system.
In 1993, an Indo-Russian treaty mandated the conduction of all bilateral
trading agreements on a hard currency basis. And tea exports were among
the most hit by this. Moreover, the World Trade Organization (WTO) regime
ensured that there were other entrants into the Russian tea market such
as Vietnam, Kenya and China which could supply tea at much lesser price.
For example, China supplies tea at an incredible Rs 16 per kg (the auction
price of the Nilgiri tea ranges between Rs 33 and Rs 47 per kg).
There was one good year
— 1997-98 — when the fortunes of the Nilgiri tea seemed
to be reviving. Prices for a kg of green tea leaves went up to Rs 21
that year. But the revival sparked by a failure of the Kenyan tea crop
that year proved to be short-lived. Despite a Memorandum of Understanding
between the Indian Tea Board and the tea associations of Russia to facilitate
an export of 100 million kgs of tea annually, Russia reduced its tea
intake from India. In 2001, it exported 67 million kg; this declined
to 47 million kg in 2002.
The fall in demand had a
direct bearing on tea prices. The distressed farmers took to the streets
in 2000, courting arrest and burning buses, to draw the attention of
the government to their plight. The central government promptly granted
a price subsidy of Rs 2 to the small farmers for a period of six months,
implying that the crisis might be temporary, which of course it wasn't.
Tea exports continued to fall: in January-April this year, the export
figures for South Indian tea were 41 per cent less than the figures
for the corresponding period last year.
Why couldn't the industry
quickly identify and develop new markets? The huge demands of the Soviet
market had fostered complacency and indiscipline in the Nilgiris tea
industry; quality was given short shrift. "Making tea for other
markets requires fine succulent leaves for which
meticulous attention has to be paid to the process of plucking and manufacturing,"
says Kapur.
The best tea is made from
plucking two leaves and a bud. But tea cultivators can obtain increased
productivity by coarse plucking of three leaves and a bud and sometimes
even more. And this is what the small tea cultivators resorted to. "A
grower has to prune the bushes once in 4-5 years to maintain quality
in the leaf. But since the Russian kind of manufacture didn't demand
pruning, people didn't prune for 10-12 years," explains Kapur.
And in today's crisis, nobody has got the funds or the ability to do
it. Small tea growers also have to employ labourers if they have to
pluck in a disciplined manner, something they are loath to do.
The small tea growers lay
the blame at the door of the local tea factories established under cooperative
sector. Says A Bhoopathy of the Kotagiri-based Nilgiris Tea Protection
Centre (NTPC), "It is the cooperative factories who are responsible
for giving Nilgiris tea a bad name. They adulterate the product with
tea waste and low quality sugar to make it more bulky." Adds Bhojan,
"If the tea leaves we provide are so bad in quality, why don't
the factories reject them outright? After all, that is their right.
If there is no demand, there should be surplus tea lying around. Where
is it?"
The auction system also
draws flak from tea growers. "96 per cent of teas produced in Nilgiris
are sold through auctions. The producers just haven't explored alternative
avenues," says T Udayachandran, chairman and managing director
Indcoserve, an apex body for tea cooperatives in the Nilgiris, who maintains
that the auction system is not transparent. "It is so buyer-dominated
that it takes only 20 seconds to knock out one lot of tea," he
says. To redress this, the government plans to set up an auction centre
at Coonoor. "75 factories have affiliated themselves to this centre.
It will become functional by September," says Udayachandran.
Meanwhile, the NTPC is trying
to get a minimum support price of Rs 15 per kg of green tea leaf. It
has filed a petitioned to the Madras high court for this purpose. The
tea board they say is is vested with powers under the Tea Act, 1953
to fix a minimum support price for small teagrowers. Under similar circumstances
the centre had fixed a minumum support price for rubber, under section
13 of the Rubber Act. The same concession should be extended to tea,
contends NTPC.
The small tea grower's woes
have been compounded by a decline in productivity per acre in recent
years. Bhojan says that ten years back, he could get up to 6,000 kgs
of green leaves per acre; today this has fallen to less than 4,000 kg
per acre. Correspondingly, the cost of fertilisers has shot up. Ten
years ago, 100 kgs of fertilisers cost Bhojan Rs 400; today he has to
shell out Rs 700 for the same amount. On an average he requires about
1,200 kg of fertilisers per acre of land in a year.
Pointing out the reasons
for this decline in soil fertility, M Selvaraj, head, Horticulture Research
Station, Ootacamund, says, "The soil has become highly acidic in
many places and has a ph of around 4 due to continuous chemical fertiliser
application." "Intensive cultivation with the chemical inputs
has led to complete cessation of the beneficial microbial activity in
the soil system and emergence of new pest and diseases" he adds.
He claims that the farmers of Nilgiris are still using some weedicides
regularly, which have been banned by other countries. Nilgiris has 125
pesticide dealers who give pesticides on credit to the cultivators.
"Rs 27 crore is due to the pesticide companies from the farmers,"
notes the horticulturist.
According to Selvaraj, 50
per cent of the area under tea can be converted for organic farming,
so the cost of cultivation can be reduced. He feels that every small
farmer should have 1 or 2 cows, which would provide natural fertilisers
to the farmers. The horticulture department has even submitted a proposal
to the state government to convert the Nilgiris into an organic farming
district. And some small growers have also experimented with biofertilisers
and gone organic with success. "But biofertilisers have to be mixed
with manure and where do we go for it?" asks Bhojan. The monocropping
pattern drastically decreased fodder cultivation in the Nilgiris which
resulted in a fall in the cattle population — Bhojan's grandfather
owned 150 cows; he has none. Consequently, farmers are not able to apply
manure for their crops, leading to reduced yields.
The Save Nilgiris Campaign
(SNC) — which began when the tea boom in the Nilgiris was in full
swing — had warned of the perils of monoculture in 1988. It had
stated: "It is a scientific fact that any monoculture, including
tea, is harmful for hill areas like the Nilgiris whatever be their immediate
economic benefit. A similar mistake was committed in the 1950s and 1960s
when eucalyptus was indiscriminately propagated all over the district.
Its harmful effects are felt now and reversing the situation has become
extremely difficult".
Intensive fertiliser and
pesticide use has also contributed to a fall in the market appeal of
Nilgiris tea — especially in quality conscious markets like Europe.
Several countries and international organisations have established the
Maximum Residue Limits (MRL) of a number of pesticides on tea. Adhering
to those standards may prove to be a tall order for the Nilgiri farmer.
For instance, the European Union (EU) prescribes a MRL of 3 parts per
million (ppm) for a vital pesticide, ethion. "Reducing ethion levels
to less than 3 ppm would be very difficult, for mites are a big problem
in the area," explains N Muraleedharan, director, UPASI-Tea Research
Foundation (TRF), Valparai. But on a positive note he says "we
have found that the tea brew doesn't have even 0.5 ppm. So we have asked
the EU to take into consideration the residue in the brew and not the
black tea. "Muraleedharan who met the European Tea Committee, last
June, "requested the Committee to take into account what leaches
into the brew that one actually drinks," he told this reporter.
Adds R Selvasundaram, head, division of entomology, UPASI-TRF, "There
are more than 300 pests afflicting tea in South India alone. We are
trying out integrated pest management methods using non-chemical ways
to control and prevent pests.Pesticides can be a second level treatment."
The small farmers say they
are now caught between a declining export market (both in terms of quantity
as well as prices) and a buyers' cartel, which hardly reflects the real
demand for tea. The import of foreign teas, following the WTO agreement
has depressed the Indian market, they feel. But dismissing these arguments,
Kapur asserts, "Last year we imported 20 million kg, a very small
figure compared to our total production of 850 million kg". He
also debunks the theory of the influx of cheap Sri Lanakan teas working
to the detriment of the Nilgiri farmer. "The average price of such
imports is Rs 85-87 per kg, which means these teas are definitely high
priced orthodox teas and India is basically a CTC market. So where is
the threat?" he asks.
Since July 2000, the government
has made some efforts at helping farmers improve the quality of their
tea, so that new markets can be tapped. "We have visited 200 villages
and educated growers about the need to do quality plucking to compete
in the international market," says S Ramu, senior scientist and
training organiser, UPASI-KrishiVigyan Kendra, Coonoor. "Due to
the efforts of the past 3 years, growers are now able to realise Rs
2-3 higher than the prevailing prices, "avers Kapur. "There
are factories today which are able to get Rs 10-15 higher than the market
average because of the changes carried out, thanks to this programme,"
he adds.
There are also subsidies
for replanting. "Wherever there are very low yielding sections
in gardens, this could be uprooted and planted with clonal material
so that we can get higher yields," says Kapur. The Tea Board also
provides Rs 62,000 per ha, as direct cash subsidy. "Our target
is every year 2 per cent of the area should be replanted. But the crisis
has not allowed us to replant even 0.5 per cent of the area every year,"
he laments.
The tea board is also trying
to develop new markets. But undoing years of dependence on one market
and almost no promotional activity is not easy. Says P S Sundar, journalist,
and a long-time observer of the tea industry in Coonoor, "The industry
says we don't have money for promotion, let the tea board give. The
tea board says we don't have money for this, the industry has to plough
back part of its profit on promotion." An initiative was taken
recently to market Indian tea in Pakistan. Pakistan is the world's third
largest importer and takes 150 million kg of tea ever year — mostly
the CTC variety. Kenya is its main supplier. Indian exports to the country
are just 3.7 million kg every year. Are political considerations the
main reason? Sundar disagrees. "I am convinced that more than politics,
they want good quality CTC tea and if Kenya has been providing them
that at low prices, why should they shift loyalties?" he asks.
Feels T Rangiah, former
chairman, Indcoserve, "It is better to promote domestic consumption.
Stick to quality tea and get rid of all the substandard stuff and automatically,
production will come down." Sundar calls for additional marketing
savviness. "The accent should be — tea is a good, healthy
drink, so consume it. Go more on the merit of tea than on mercy to the
farmer. " According to J Lakshmanan of NTPC, all it needs is India's
own per capita consumption of tea to increase from 0.66 kg to 0.83 kg.
"Then there won't even be the need to export," he says.
The government is also gearing
up with quality parameters. A crude fibre content rule is being framed
under the Prevention of Food Adulteration Act (PFA), 1954 which will
basically strengthen the field practices. "The change in PFA and
the strict implementation of International Standard Organization (ISO)
and Hazard Analysis and Critical Control Point (HACCP) and the well-known
ISI mark from the Bureau of Indian Standards is very important,"
says Sundar. In the post-WTO regime, teas without ISO and HACCP certification
would be out of the shelves in the developed and cash-rich countries.
The EU, US and Japan have already started insisting on the HACCP certification
from tea suppliers.
Is there an alternative
to tea in Nilgiris? Selvaraj feels that mushrooms could be one. Ramu
however questions any move towards alternatives. "Vegetables are
very costly. Tea is a perennial crop and it will be tough to switch
to annual crops like potatoes," he says. Environmentally too, some
feel tea to be a better alternative than vegetables. Says M Madhu, senior
scientist, Central Soil and Water Conservation Research and Training
Institute, Ootacamund, "If tea had not been there in the Nilgiris,
most of the soil would have been in the Bhavanisagar dam."
The SNC has a different
point of view. During the days of the tea boom, the campaign had advocated,
"Small growers should be encouraged to bring back at least one
tenth of their land under horticultural crops. That would protect them
against market fluctuations and also provide assured sustenance."
This they feel holds good today as well.
The Korakundah biotea project
in Upper Bhavani of Nilgiris district is one of the highest organically
grown teas in the world. Of the 2,500 acres, only 800 acres is tea plantation.
The rest is rolling grasslands, shola trees and gurgling streams. Organic
orthodox black tea, green tea, decaffeinated tea and CTC tea are manufactured
here and exported to Europe, US and Japan.
"This estate went organic
in1994. Since it is isolated, organic cultivation had every chance to
succeed here," says K. Jagan Thimaiah, manager of the estate. He
agrees that the yields do come down in organic cultivation. "But
you make up for it by realising higher prices," he avers. The estate
uses vermiculture, biodynamic methods and natural manures. Korakundah
has a vermiculture shed which uses cow dung, water, jaggery, banana
stumps, earthworms and dry leaves. The estate also grows its own fodder
for the cattle. "We make 8,000-10,000 kg of vermicompost and 500
tonnes of compost per year, which is the main manure. About 25 tonnes
of compost is used per hectare. Other things used are panchakavyam,
fish waste liquid manure and bio-dynamic preparations involving cow
dung and 5 herbal plants,"explains K M Kalappa, assistant manager
of the estate.
The Havukal estate cum brought
leaf tea factory in Kotagiri is not crisis-ridden, like other Nilgiri
tea farms. "We sell only 25 per cent of our tea at the auctions.
More than 40 per cent is sold directly to Germany, Switzerland and UK,"
says Jayayram Thangavelu director of the estate. His estate produces
12 lakh kg of tea per annum, only 30 per cent of which is grown on Havukal
estate. The rest is procured from about 80 small growers, in whom scrupulous
regard for quality has been deeply ingrained. Thangavelu also pays his
small growers up to Rs 9 per kg. 80 per cent of Havukal tea is orthodox.
"There was tremendous pressure to change to the crushed torn curled
variety when the Russian market was supreme. But we resisted that and
stuck to orthodox," he says. Of course, he gets much lesser prices
today than before.
(This article is part of
a media fellowship awarded by National Foundation for India)
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