The Role of Bought Leaf Factories!

The South Indian Tea production was largely in the hands of British players like James Finlay, Harrisons & Crosfield, English & Scottish, Pierce Leslie, Bombay Burmah Trading Corporation, Tea Estates India, Aspinwall (quite a few companies were managed by them), Stanes group in the Nilgiris and others.

The two big groups under Indian ownership were A.V. Thomas & Co. (not to be confused with J. Thomas & Co), and Jayshree & Manjushree Tea Companies (owned by the Birlas).

In a decade almost all the sterling companies listed above changed hands and were taken over by Indians. The Tata’s took over James Finlay, the rest were mainly taken over by Marwaris. The Bangurs took over the Pierce Leslie properties in the Annamalais. Poddar took over Matheson Bosanquet and so on. A few South Indian business men also became important players.

However, another sector was slowly developing in the 50’s. These were agriculturists, small holders with tea farms of 5 to 50 hectares in extent. Some of the larger ones ran tea factories, using second hand machinery from the larger ‘company estates’. They would buy green leaf from other small tea growers and together would have enough green leaf to produce 2 to 5 lac kg of made tea per annum.

Their capacity increased with better machinery, and improved manufacturing practices.

Most of these tea growers came from the Badaga community. 

The story is that these people ran away to escape religious persecution by Tipu Sultan who was the Ruler of Mysore State between 1750 and 1799. (https://en.wikipedia.org/wiki/Tipu_Sultan)

The Badaga Community spread out across the Nilgiris District (4000 to 7000 ft. above sea level) in the State of Madras (now Tamil Nadu). They were enterprising and opened up farms and raised cattle. Many worked for the British companies who were opening Tea and Coffee Estates in the Nilgiris. Since there was plenty of land for the asking they too started planting these cash crops.

Some worked in the factories and got an understanding of tea manufacture. Most of the Badaga children went to schools which were opening up in the Nilgiris and became literate. And by the late fifties and early sixties they were quite well developed and were producing a fair quantity of tea. They were known as Small Growers and their factories were known as Bought Leaf Factories.

The tea cultivation by Small Growers was backward in many cases with haphazard plucking cycles, and inadequate attention to tea planting practices, and coupled with the old machinery these factories could not produce quality teas.

They started out with orthodox teas which were often flaky and the liquor was either smoky or high-fired. Brooke Bond and Lipton would reject most of these teas as they were unusable in their blends.

Once CTC manufacture was introduced the Bought Leaf factories were quick to take it up in all their factories as it suited the type of green leaf that was available.

In 1964, a Tea Factory owner by name B. K. Bella Gowder asked J. Thomas & Co for a loan of INR 100,000.00 to buy a new Tea Dryer. INR 100,000 (or Rs.1 lac) was a humungous amount at the time! (US$100 in 1964 is equivalent to UD$ 6600 today!) 

It required guts to ask for such a huge sum, but Bella Gowder was convinced that he could repay the loan with the improved prices he would get for his teas. And he was not wrong!

Till that time no Broker in South India would loan such an amount to anyone from the Bought Leaf (BL) sector. Satyanath referred this loan request to the JT Chairman, Vinod Parekh. Parekh, who came from the risk taking Gujarati community, saw a golden opportunity. He called Sat and gave him the green signal!

The larger Tea companies were conservative. Once they appointed a Tea Broker it was unlikely they would change. Since Forbes, Ewart, & Figgis and Carritt Moran were operating in Cochin long before J Thomas arrived on the scene, relationships between the Producers and the old Brokers were strong and it was very difficult even for a large Broker like JT to get a break-through.

For a Broking company to survive it must reach critical mass to achieve break-even. The brokerage was standard and fixed by the Tea Trade Association at 1% of the selling price. The income per kg was minuscule and one needed to sell large quantities to succeed.

The BL sector would therefore have to be JT’s route to reach that critical mass. Parekh & Satyanath saw in B.K. Bella Gowder’s proposal a great opportunity to win the hearts and minds of the leading Bought Leaf Factory players!

Also, we were getting tired of snide remarks perpetuated by our rivals that J. Thomas & Co had more cars than the number of Lots they sold each week. I could sense a tinge of envy in that remark and quite often it worked in our favour!

Having had a crash course in tea manufacture at the Birla estates I was sent off to the Nilgiris to advice Bella Gowder’s Aravenu Tea Factory how to make better teas. They had installed the brand new Sirocco Dryer by then.

J. Thomas & Co can be proud of putting the Bought Leaf sector of Nigiris on the map. The small growers would have achieved this some time or the other but JT acted as the catalyst to bring this change sooner than later. All of a sudden tea machinery manufacturers opened offices in Coonoor to sell CTC machines, Dryers, grading machines, and engineering firms came to fabricate machinery, automate process and so on. The industry was on a roll!

Brooke Bond and Liptons were now happy to include many of these teas in their blends. They used them as ‘fillers or price reducers’. The leaf appearance was acceptable, while the liquors were mild and neutral.

The Tea Board, under Government of India’s Ministry of Commerce, decided to open their South India regional office in Coonoor. They gave subsidies for uprooting old tea bushes and replacing them with better varieties. Of course all this was not just for the BL sector, the large estates also benefitted. But the small growers were able to bring political pressure because they were many in number.

The Tamil Nadu government also got into the act. They organised small growers to form cooperatives in each area and set up Industrial Co-operative Factories which would buy green leaf from the members to manufacture tea. Today, I would hazard a guess that the Indcos would produce 20 million kilogram of tea annually. This is over and above the production of the BL factories in the private sector.

With the early stirrings of interest, the Tea Producers, Brokers, and Buyers formed the Coonoor Tea Trade Association (CTTA) in 1963. The first auction was conducted on 23rd March 1963 with 70 lots comprising 20,303 kgs of tea from 43 factories.

The first Tea Broking company in Coonoor was Sohrab Ardeshir Brokers Co. P.Ltd. (SABC) which was formed by the coming together of some tea planters from the Nigiris.

The Cochin Brokers, namely Forbes, Ewart, & Figgis and Carritt Moran decided to join hands and print a catalogue together. The first joint catalogue came up for Sale in the second half of 1963 but before the first Lot was sold Carritt Moran pulled out!

Coonoor is 6000 ft above MSL. Blessed with a salubrious climate and verdant hills, it was just the place the British would have liked to build a settlement. There were schools and churches, a wonderful botanical garden with trees from all over the world. The Pasteur Institute of India, was set up in 1902 at Coonoor and is one of the leading laboratories in the production of Anti Rabies Vaccine. 

The Coonoor Club was the proverbial British hideaway in such a Hill Station.

For visitors there was a delightful place to stay called Hampton Hotel run by the Adiges. It is now a Taj Hotel property.

Mr. Adige was a retired Police officer from Mysore State. Sue Adige was a superlative cook. They made a most hospitable couple with Mr. Adige behind the Bar regaling us with wonderful stories and Sue Adige supervising the cooks! To suit the flavour of the times the menu was largely Western. Food was excellent and the place had old world charm.

As I said earlier I became JT’s ambassador to the BL factories. I would journey by car from Cochin to Coonoor once every couple of months. It took 7 hours of driving to get there. Each stay would take two or three days. Over a period of time I was accepted and became close friends with the heads of important Badaga families.

Aravenu and ‘marks’ like Riverside and others started being printed in the JT catalogue. With better equipment and more care in manufacture their teas began to get better prices. There was increased competition between factories and this resulted in more factories being opened. The Nilgiris was thriving!

In my language Malayalam, there is a saying that goes something like this, “Mooku illatha rajyathu murimookan Rajah!” (In a land where no one has a nose, a man with half a nose is king!)

My limited experience did not inhibit the Badaga community from welcoming me as the ‘prince of tea manufacture’!

But I did not know at the time that my association with the Nilgiris would grow stronger and last for over three decades!

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