The tea industry is gripped by an unprecedented crisis due to price crash and high cost of production. Although the industry had gone through cyclic phase with good and bad times in the past, the present slump appears to be rather prolonged, In this scenario cost control is of vital significance. Looking back, one can derive immense satisfaction on the achievements in the production front. In South India, compared to the performance in 1985 the production had gone up by 45 per cent by 2000 (Table-1).However the steep rise in the cost of production during the last decade has been a matter of great concern to the industry, The total cost of production, which was Rs. 17.00 per kg during 1985, had zoomed to around Rs. 60.00 per kg by 2003 (Table-1) registering an increase of 253 per cent. This is mainly due to the quantum jump in the labour wages especially in the 1990's (Table-2) and the increase in the cost of inputs (Table-3). Another disturbing factor is the volatile price situation. The industryhas been going through the most turbulent period as far as price realisation is concerned with price levels plummeting to the level existed in early 1990's (Tabie-4). This has significantly eroded the margins compelling the estates to look at possibilities of cost control.
展开▼
