Association urges reforms in tea auctions<\/p>\n
JAKARTA (JP): The Indonesian Tea Association (ATI) has
\nsuggested that private brokers should take part in the tea
\nauctions which are currently run by a joint marketing board as a
\nmeasure to boost the price of Indonesian tea, an association
\nexecutive said on Wednesday.<\/p>\n
\"We (ATI) have come to the conclusion that we need fundamental
\nchanges in marketing Indonesian tea,\" Insyaf Malik, ATI's
\ntreasurer, said at the opening of this year's tea auctioning
\nseason.<\/p>\n
Insyaf, who is also director of state owned PT Perkebunan
\nNusantara VI (PTPN VI), a tea producing company, said that
\nprivate brokers help to raise the price of Indonesian tea, which
\nover the past 10 years has dropped in the international market.<\/p>\n
At present, the state joint marketing board (KPB) acts as a
\nsingle body to auction tea on behalf of state-owned tea
\nplantations, through which, however, private plantations also
\nmust auction their tea.<\/p>\n
KPB as a state body receives no commissions from the tea it
\nsells, a condition that would have to change, Insyaf told
\nreporters.<\/p>\n
He said that by allowing private brokers to auction tea, KPB
\nwould be forced to set better prices for tea producers.<\/p>\n
\"To KPB, it makes no difference whether our tea is sold at
\nUS$1 or $2, their salary remains the same,\" he said.<\/p>\n
Indonesian tea prices have dropped from an average of 150 U.S.
\ncents per kilogram in 1998, to an average of 110 cents per
\nkilogram during the first five months in 1999, according to data
\nfrom ATI.<\/p>\n
Insyaf said that before 1990, Indonesian tea prices had always
\nbeen higher than those for Sri Lanka and Kenya, two of the
\nworld's largest tea producers.<\/p>\n
He said that to investigate the reasons behind the drop in
\nprices over the past 10 years, the association had established a
\nteam to make comparative studies on other countries' tea
\nmarketing systems.<\/p>\n
\"Indonesia is the only producing country not to have private
\ntea brokers,\" Insyaf said, adding that KPB's monopoly would
\nhinder the commitment that brokers could bring.<\/p>\n
In India, the world's largest tea producer, nine to 10 brokers
\npress India's tea producers for quality and quantity to meet
\nmarket demands; thus ensuring higher commissions from better
\nprices, he said.<\/p>\n
He said the team was working on a concept for marketing tea
\nthat would be presented to the Indonesian tea industry and the
\nState Minister of Investment and State Enterprises Development.<\/p>\n
For this year's outlook, Insyaf predicted that Indonesia's tea
\nproduction would not differ much from previous years.<\/p>\n
During the last decade, Indonesian annual tea production
\nhovered between 140,000 metric tons and 166,000 tons with yearly
\nexports reaching about 80,000 tons to 120,000 tons.<\/p>\n
Separately, marketing director of state owned PT Perkebunan
\nNusantara VIII (PTPN VIII), Suwadji Munawar, agreed that
\nintroducing private brokers would improve KPB's performance.<\/p>\n
\"It's possible,\" he said, but added that the government should
\nregulate their presence.<\/p>\n
PTPN VIII is Indonesia biggest tea producer, with plantations
\nlocated in various parts of West Java.<\/p>\n
Suwadji said he was optimistic that prices of Indonesian tea
\nwould rise slightly to about 130 cents per kilogram, which he
\nattributed to higher awareness of tea producers and better tea
\nquality.<\/p>\n
He was also satisfied with the opening of this year's tea
\nauction, saying that it had been a good start considering that
\nthe auction was held during the Islamic holiday season of Idul
\nFitri.<\/p>\n
Yesterday's tea auction offered 1,000 tons of black and green
\ntea, of which 62 percent was sold, according to KPB's sales head,
\nSyarif Abdullah. (03)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/association-urges-reforms-in-tea-auctions-1447893297",
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"sponsor": "Okusi Associates",
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