Assam's Tea Prices Plummet 15% Amid Flood Crisis and Production Issues

Dispur, India Aug 28, 2026 ALN: Assam's tea industry is currently facing a severe crisis as the average CTC tea price at the Guwahati Tea Auction Centre (GTAC) has plummeted by approximately 15%. The price fell from Rs 264.89 in Sale No. 26 to Rs 221.57 in Sale No. 34 within a span of less than two months, reflecting the adverse impact of devastating floods, unfavorable weather, and pest infestations.

The Tea Association of India (TAI) has expressed serious concerns regarding the sustainability of the tea sector, highlighting that growers are under immense pressure as production has already been disrupted by natural calamities and climatic factors. This situation is particularly alarming given that Assam is one of the largest tea-producing states in India, contributing significantly to both national and global tea supplies.

In a statement released on Friday, the TAI emphasized that the tea industry is experiencing a particularly challenging season, especially in Assam, where recent floods have inundated vast areas of tea plantations, severely affecting crop output. The floods, which are a recurring natural disaster in the region, have not only submerged tea bushes but have also led to soil erosion and the degradation of land quality, further jeopardizing future harvests.

“The auction price figures from the north Indian tea industry recently indicate a precarious situation, compounded by flash floods, excessive heat, and significant pest and disease infestations that are hampering crop production during the current season,” stated TAI president Shailja Mehta. The combination of these factors has created a perfect storm for tea growers, who are already grappling with the economic ramifications of fluctuating market conditions.

Mehta further elaborated, “A grim reality is unfolding in the tea industries of Assam and West Bengal, where the sharp decline in auction prices over the past five to six weeks has raised widespread alarm, jeopardizing the sustainability of the tea industry.” The tea sector is not just a vital part of Assam's economy; it is also integral to the livelihoods of millions of people who depend on tea cultivation and processing for their income.

According to the association, auction prices have decreased across the three major north Indian tea centers—Kolkata, Guwahati, and Siliguri—between July and mid-August. However, the situation in Assam is particularly alarming, as the state is responsible for a significant portion of the country's tea production and has been severely impacted by repeated flooding this year. The cumulative effect of these natural disasters has led to a decline in both the quantity and quality of tea produced, raising concerns about the long-term stability of the industry.

The TAI clarified that the downturn in prices cannot be attributed to oversupply. Data from the Tea Board indicated that north India's tea production until June was approximately 16 million kg, or 5%, higher than the same period last year. However, subsequent adverse weather events have drastically altered the production outlook. The tea industry is often sensitive to climatic changes, and the erratic weather patterns observed in recent years have made it increasingly difficult for growers to plan and manage their crops effectively.

Mehta noted that data from TAI member estates indicated an 8% decline in crop production in July, with a similar decrease anticipated in August due to flood damage in Assam and severe pest infestations affecting other tea-growing regions. The association estimates that by the end of August, north India's tea output could be reduced by around 8 million kg compared to last year. The repercussions are expected to be particularly severe in Assam, where submerged tea bushes may take a considerable amount of time to recover, potentially impacting production in the coming months.

Additionally, the industry body raised alarms over the declining export figures. Despite India achieving a historic tea export of 285.53 million kg in 2025, exports during the January–June period of 2026 have decreased by approximately 23 million kg, or nearly 18%, compared to the same timeframe last year, according to Tea Board statistics. This decline in exports not only affects the revenue generated from tea but also raises concerns about India's competitiveness in the global tea market, where countries like Kenya and Sri Lanka are vying for market share.

In light of these developments, the TAI has warned that falling auction prices, diminishing production prospects, and escalating operational costs—including higher wage liabilities and bonus payments—are placing the tea industry under significant strain. This raises serious concerns regarding the long-term viability of tea cultivation in Assam and other north Indian tea-growing regions. The challenges faced by tea growers could lead to a decrease in the number of small tea estates, which are essential for maintaining the diversity and quality of tea production in the region.

The situation calls for urgent attention from policymakers to address the underlying issues plaguing the tea industry. Potential solutions could include increased financial support for affected growers, investment in flood mitigation infrastructure, and research into pest-resistant tea varieties. Without decisive action, the future of Assam's tea industry—and the livelihoods it supports—remains uncertain, highlighting the need for sustainable practices and resilience against climate-related threats.