India has penetrated further the Russian tea market, the dominant player.

Constraints in supply coupled with improved prices brought better price realisation in each market, with India increasing its earnings to Rs. 2,617 crore in 2009 from Rs. 2,393 crore in 2008, exporting 192 million kg of tea which was 11 million kg less than the previous year. “Better clonal varieties were emerging through replantation as there is greater awareness about improved quality now,” sources said.

Referring to Russia, sources said that lower crop in countries like Sri Lanka which has captured some of India's traditional markets has also helped. India exported 45 million kg of tea to Russia in 2009 as compared to 40 million kg in 2008. The total market in Russia is estimated at around 180 million kg in which Sri Lanka, a producer of orthodox tea, had a dominant share till 2008. India has been able to make gains due to increased orthodox tea production. Prices stood at Rs. 116.80 in 2009 against Rs. 100.80 a kg in 2008.

Pointing out that India planned to retain its gains in Russia this year too, sources said that although Sri Lanka had now been able to increase its output, supply disruptions were not taken kindly by importing countries as it upset their blend. “Once they settle down to a blend they normally do not disrupt that,” sources said. Unlike most other tea producing and exporting countries, India has dual manufacturing base, producing both the crush-tear-curl (CTC) and orthodox tea varieties besides green tea. The weightage in production is in favour of CTC tea in tune with domestic preference and orthodox tea production is balanced basically in proportion with export demand.

The government has announced schemes to boost orthodox tea production as it was found that traditional markets like Russia's tea drinking preferences were shifting in favour of the aromatic orthodox tea.

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