GUWAHATI: The Tea Board of India has decided to revert to the erstwhile English auction model for auctions across the country, considering the drop in sales through the Bharat auction system, which drew widespread protests from tea planters of Assam

In 2022, the Board introduced Bharat auctions for better price discovery, lower transaction costs and ensure the quality of tea sold through the auction system.

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A decision to this effect was taken on Monday evening following the representations by stakeholders to the Deputy Chairman, Tea Board, highlighting issues related to the Bharat Auction. 

“This has reference to various letters/ representations issued by the stakeholders to the deputy chairman, Tea Board highlighting several issues relating to Bharat Auction followed by the stakeholders meeting held under the chairmanship of honourable CIM, wherein instruction was passed to bring in practices of the erstwhile English Auction model under the ambit of Bharat Auction. In this regard, the necessary timelines for reverting to English Auction in respect of all auction centres across India have been worked out in consultation with NSEIT Ltd,” Tea Board controller of Licensing Rajanigandha Naskar said in an order on Monday evening.

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According to the order, sale no 39, which is scheduled to be held on Tuesday (September 26), has been cancelled for all auction centres for server installation for the English Auction. 

Similarly, sale no 40 has also been cancelled. These will be held from October 3 to 6 and sale 41 will be held on October 17.

The decision of the Tea Board raised protests from tea planters from Assam and the Northeast.

“This circular comes as a shocker to us too at this critical juncture when the industry is struggling to take care of its day-to-day operations. Without qualifying further, we request you to kindly rescind this decision with immediate effect and call for a proper discussion to decide on a proper and acceptable timeline to bring back the English Auction,” said CM Joseph, president of Nilgiri Wayanad Tea Association, Kolkata. 

At a time when Durga Puja Festival is knocking at the door and the tea industry has to pay a huge amount as a bonus to its labourers, the stoppage of the auction will upset all stakeholders in the trade.

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In a letter to the Tea Board, Tea Association of India (TAI) secretary general PK Bhattacharyya said: 

“We would like to express our appreciation for the steps taken by the Tea Board in transitioning back to the English Auction Model. This move is certainly in the right direction.

“We would like to bring to your attention a matter of concern related to the decision to drop Sale Nos. 39 and 40 to facilitate the conversion to the English Auction Model. This decision, while well-intentioned, may have adverse consequences on the cash flow of tea companies, especially at a time when all tea garden managements are already facing financial obligations to meet their bonus commitments.”

“The deferment of the sale of catalogued teas could potentially result in a severe cash crunch for all tea companies, making it challenging to fulfil impending financial commitments and possibly creating a law and order situation in the garden,” Bhattacharyya said.

“We would also like to bring to your notice that the catalogues for Sale Nos. 39 and 40 have already been uploaded, and trade samples have been distributed to the buyers. Buyers have completed their pre-sale work as well.

“We request that Sale Nos. 39 and 40 proceed as scheduled. Simultaneously, while Sale 39 and Sale 40 are being conducted, the work of reverting to the English Auction can be undertaken in the background. We understand that this should not pose significant issues, especially considering that Orthodox and Darjeeling Teas are already under the English Auction System,” he said.

“The English Auction can be made live from Sale 41 onwards. We sincerely hope for your favourable consideration of these suggestions. We aim to ensure a seamless transition to the English Auction Model without disruptions and undue financial strain on tea companies,” he added.