Chronicle Editor
Sikhulekelani Moyo, [email protected]
AGRICULTURE concern, Ariston Holdings Limited says its strategy to drop 20 percent of lowest-yielding tea gardens where fertiliser application at the new increased price could not be justified is paying dividend as it has resulted in increased production quality and quantity.
Export tea sales volumes reached 1,343 tonnes in the third quarter ended 30 June from 897 tonnes in the prior comparative period.
In a statement accompanying its trading update for the third quarter which ended 30 June 2023, Ariston company secretary Ms Nkosilothando Ncube said in the period under review, the Group made the decision to drop 20 percent of the lowest yielding tea gardens where fertiliser application at the new increased price could not be justified.
She added that at the same time, harvesting was changed to ensure better quality of Greenleaf and production equipment was also further enhanced to improve made-tea quality so as to increase export tea quantity.
The update indicates that total tea sales volumes improved considerably when compared to the last two prior comparative periods.
Export tea sales volume improved to 1,343 tonnes, which made up 57 percent of total tea sales for the current period compared to 897 tonnes which represented 46 percent of total sales in the prior comparative period.
“This strategy resulted in tea production volumes reducing by 21 percent from 2,850 tonnes to 2,245 tonnes, and export tea sales volumes improving to 1,343 tonnes from 897 tonnes in the prior comparative period,” she said.
“This significant shift in the sales volume make up is attributed to improved tea quality coupled with improving logistics post the COVID-19 induced logistics bottleneck. Logistics challenges have not yet recovered to the pre-COVID 19 pandemic period but there are some improvements. Average selling prices for both export tea sales and local tea sales remained firm during the period,” reads part of the update.
The improvement experienced in the average selling prices of both local and export tea is expected to continue to the end of the financial year.
On macadamia, Ms Ncube said the harvesting period started towards the end of March as that was when the nuts had reached maturity.
Macadamia export sales volumes at 513 tonnes are currently 35 percent lower than the 785 tonnes sold in the prior comparative period.
“Export supply contracts are on hand with various customers for the majority of the tonnage produced to date, however, shipping delays have been experienced which has resulted in slower movement of the macadamia nuts,” she said.
Meanwhile, tea producers are investing in solar projects which are meant to improve production as well as reduce the cost of doing business.
Recently, Tanganda Tea Company revealed that its investment in solar energy and a vast improvement in the national power supply is yielding favourable results by reducing the cost it incurs in sourcing power.
Ms Ncube said a high rise in fuel expenses led to Ariston board reaching a decision to invest in a solar power generating project, which was completed in July this year.
The firm invested in a 500Kva solar energy plant which was installed at Southdown Estate.
She said the solar system is expected to reduce the cost of producing tea to sustainable levels.
“The full effect of this significant investment will be felt in the year ending 30 September 2024 and not in the current year’s performance,” she said.
The company also revealed that in inflation-adjusted terms, revenue for the period was $28,3 billion, 18 percent ahead of the prior comparative period revenue of $23,9 billion.
In inflation adjusted terms, revenue for the period was $28 billion, 18 percent ahead of prior comparative period revenue of $23 billion.
Online Reporter