Tea stuck at port, shortage looms

Despite the State Bank of Pakistan's (SBP) permission to clear the containers at the port of raw materials and essential goods, thousands of containers remain stranded, including hundreds of containers of tea.

This situation has given rise to fears of shortage akin to that of raw materials, pulses and other food items, with tea expected to added to the list.

In this regard, the former chairman of the Pakistan Tea Association Muhammad Shoaib Paracha said that there were concrete fears of a severe shortage and an increase in prices in the coming days.

“The main reason for the expected tea shortage is the 250 tea containers at the ports till now,” said Paracha who is also member of the FPCCI Executive Committee.

The State Bank allowed the import of containers in Chapters 84, 85 and 87, but it is not clear whether tea leaf is included in it, he continued.

Paracha said that after protests by traders, the State Bank allowed the release of containers on late payment after 180 days, but tea leaf sellers are not allowing late payment.

Due to this, it is feared that sellers would not take orders in future.

This has made the situation more complicated.

He said that due to the non-availability of dollars in commercial banks, demurrage and container fares of millions of rupees have been imposed on importers so far.

"One of the main reasons for the shortage is the absence of a longterm policy by the government," he maintained.

Paracha added that tea is a basic ingredient that every common man consumes.

The demand for tea is around 250 million kilograms annually.

The depreciation of the rupee last week has caused an average difference of Rs110 in the per kg price of tea.

He said that with no clear policy for new imports, the supply chain can be severely affected.