After several harvests affected by drought, the tea producers of Misiones celebrated that the the constant rains have generated a strong recovery of the crops in their plantationsyes, but in the last few weeks Shoot harvesting slowed in the dryers and some of the crop began to be discarded on farms.
The farmers of Misiones managed to market the entire first harvest and a good part of the second, but the factories warned that Shipments to the United States are delayed and the huge inventories they have in their warehouses prevent them from continuing to receive raw materials.. It is almost a given that the third and fourth harvests of the 23/24 harvest will not be processed and will remain on farms. A loss that no one yet dares to calculate.
The situation raises a big question for next spring, as there are many producers who will not be able to afford the costs of pruning, fertilizing and applying glyphosate to their plants.
Tea production has its own particularities. Misiones concentrates 90% of Argentine tea, intended primarily for export, with the United States as its main market. Our country is the largest producer in America and ninth in the world.
90% of Argentine tea production is destined for the foreign market and its volume represents almost 2% of global consumption. The main destination is the US market, with 70% of production.
The harvesting of the tender shoots is carried out mainly with machines in the spring and summer period, and the drying process must be carried out quickly to avoid rotting and loss of quality. Argentina is among three countries that have almost all mechanized harvestingbut this is not enough for a market with big players like China and India.
Cristian Klingbeil is a tea producer and also provides harvesting services to other farmers in the central Misiones area. “The loss of profitability in the sector has been going on for ten years. We were about to receive the death blow from the national government with the application of withholding taxes on exports, but fortunately the situation was reversed,” he explained.
The decision to cancel the withholdings raised the price per kilo of sprouts to 61 pesos. “It’s not a bad price, but It should be 75-80 pesos for the business to be profitable“, says Klingbeil. The collection and transport service represents 35% of the value.
The producer acknowledges that “we don’t know for sure how much tea has already been thrown into the fields, but we can say that about half of the second harvest. The third is expected to be completed within 45 days and it is not yet known what will happen because there are rumors that some dryers will directly stop and no longer purchase raw materials.”
For Klingbeil “it is not a problem of small producers. Even the integrated ones, i.e. the industries that have their own tea plantations, are discarding raw materials. The problem with this production is that there is a time to come in with the car and collect. If it happens you have to throw it away and wait for the new budding and see if in the next passage (of the harvesters) the dryers will buy you.”
Argentina exports tea at prices between $1.20 and $2 per kilo. 95% of production is destined for this market, with a foreign exchange earnings of over 80 million dollars per year.
For Jonathan Klimiuk, tea producer and exporter, what exists is “a perfect storm. On the one hand we have a lot of rain and heat, which favor sprouting. We estimate that production grew between 30 and 40% in the first two harvests and the dryers do not have the capacity to process so much raw material in such a short time. Added to this is a 30% drop in sales to the United States, our main buyer; and a decrease in the dollar price of 10%,” she explained.
Klimiuk, who ships about four million kilos of tea around the world every year, said that “There may also be some speculation from American importers due to the situation in the country.”.
But it was not only in Misiones that there was a strong recovery in tea production. “In Kenya the tea harvest is a record and the prices have collapsed by 60% because they have nowhere to put such an amount,” added Klimiuk, who has had to discard two million kilos of tea shoots from his fields due to of the impossibility of working them. They. .
Source: Clarin
