ASSESSING POTENTIAL OF LOCAL TEA PRODUCTION IN PAKISTAN

This study was conducted in April, 2004 in District Mansehra and Battgram being the major tea producing areas in Pakistan to find out the potential of local tea production. On average, the yield of tea on growers’ fields has fluctuated between 352 kg (fresh leaves) per acre to 393 kg per acre during the 1997- 2002 period. This gave the growers annual gross income of Rs. 4224 to Rs. 5895 per acre (for the fourth year onwards since there is no yield in the first 3 years of tea cultivation). On average, the growers had to bear 60931 per acre as total cost for 4 years and Rs. 11833 per acre, for every subsequent year for the 2000- onward period. Against these expenses, the growers on average received Rs. 5370 during the initial 4-years, leaving Rs. 55,561 as losses per acre. While in each subsequent year, they received additional losses of Rs. 6176 for the 2000-onward periods. Tea plantation therefore had not been profitable for the growers, in spite of the fact that the sale price of fresh leaves was enhanced from Rs.12 per kg in the first period to Rs.15 per kg in the second period. However, the tea grower continued growing tea plantation because of the subsidies provided by the National Tea Research Institute, Shinkiari, Mansehra. Presuming, growers should get at least Rs. 12,000 net income from an acre to substitute to the tea cultivation, and adding with this average annual cost of Rs. 12,000 per acre for tea cultivation, grower’s gross income would reach to Rs. 24,000, which would require a sale rate of Rs. 20 per kg and yield of 1200 kg of fresh leaves per acre from growers’ fields, which would suffice to cover initial four year expenses of Rs. 61,000 per acre in 2.54 years (2 years and 7 months)