AGRIBUSINESS firm Ariston Holdings reported a 21% drop in tea production volumes for the six-months ended March 31, 2023, as a result of a change in the group's strategy which focused more on raising quality while eliminating low-yielding tea estates.
In a statement accompanying the results for the half year, Ariston said there was a 51% increase in export tea volumes as well as a 16% increase in the average export selling price.
“Tea production volumes achieved for the first half were 1 599 tonnes. This was a 21% decline from the prior comparative period,” the firm said.
“The decline is attributable to the group’s shift in strategy, in which production volumes have been reduced by taking out lower yielding tea gardens and providing greater focus on improving quality so as to increase export volumes and value.”
In the outlook, the company said cost containment remained a key focus area for the group as it remained resilient under the current challenging business environment.
“The group continues to hope for more stable policies that will improve quality of business decisions and planning,” the group said.
Local tea sales volumes declined by 24% as more sales were channelled to the export market in an effort to protect value, given the depreciation of the Zimbabwe dollar, the firm indicated.
The average selling price for local tea increased by 22% during the period under review.
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The group achieved a 31% growth in macadamia nut production volume compared to the prior comparative period.
During the period, 50% of the projected annual crop had been harvested as compared to 36% in the prior comparative period.
“However, exports had not yet commenced. In the prior comparative period, a late export delivery in October 2021 was recorded. While sales of macadamia had not occurred for half-year, off-take contracts were on hand.
“Challenges on logistics remained as in prior year, and these had the effect of slowing down deliveries, and therefore sales,” said Ariston, adding that the group’s macadamia nut exports had commenced, with indications that there is greater interest for the product in current year compared to the prior year, as the global market recovers from the effects of the COVID-19 pandemic.
However, average selling prices were expected to remain the same as those achieved in prior year. Tea prices are expected to remain firm while the prices for the other products are also expected to be firm.
Indicative yields are showing an improvement on the comparative prior period.
