Taj Mahal Tea Earns a Place in Guinness Record Book
Another interesting piece of news comes from Taj Mahal Tea. Continuing with the brand’s association with Hindustani music, the brand put up a billboard in Vijayawada, in south India, a city chosen to be an important Tata Tea market. With the monsoon in full swing, the billboard doubles as a santoor, a string instrument. When it rains, water fills the scooped pegs that sound the notes, producing a tune known as the Raag Megh Malhar, a song of the rains. The brand made it to the Guinness Book of World Records as the largest innovative installation to interact with the environment.
New Start-up Seeks to Plant Tea for Social Good
From Manipur, a state in northeast India, comes news about a startup called Meckley Tea India. The company, started by Milan Koibam, has embarked on a business to promote tea tourism in the state. Manipur borders Assam state, so tea is not a farfetched idea. Earlier this year, the state was in the news due to ethnic violence between two groups, the Meitei and the Kuki. Keeping this aside, Manipur has great natural beauty, although poppy cultivation has been a socioeconomic problem for a long time now. Meckley Tea now hopes to replace poppy – cultivated on 7,500 hectares – with tea cultivation to provide employment and also improve the state’s GDP.
Holiday Consumers Lose Confidence Before Black Friday Sales Begin | YouGov Survey of American Shoppers Finds 52% Won’t Shop on Black Friday | Tanzania Debuts Digital Tea Auction in Dar es Salaam | Tea Barter: Cash Short Egypt Offers Kenya a Blank Check
Tea News for the week ending Nov. 17
India News Update
Featured
Tanzania is the third-largest tea producer in Africa. Smallholders there farm 48% of the country’s 23,800 hectares under tea. Data from the Tea Board of Tanzania (TBT) estimates that 32,000 tea smallholders collectively produce about 40% of the country’s green leaf. As Director General, Theophord C. Ndunguru is the voice of the Tanzania Smallholders Tea Development Agency (TSHTDA). In October, I traveled to Dar es Salaam to talk with Theophord and fellow tea board members to better understand the state of tea smallholders. Today’s report is an excerpt from our discussion.
Tanzania conducted the inaugural Dar es Salaam digital tea auction this week, fulfilling a government mandate to stop exporting locally grown tea through the Kenyan port of Mombasa.
Four gardens sold a combined 1,320 packages (66,920 kgs), leaving 58% of tea unsold. Marks on offer include Arc Mountain, Chivanjee, Diddira, Kwamkoro, Kibena, Ikanga, and Itona.
The East Africa Tea Trade Association (EATTA), which runs the Mombasa tea auction, said the competing auction did not impact prices at its twice-weekly sales. The East African reported Mombasa could lose 25% of its current volume if Dar es Salaam meets its goal of selling 65,000 metric tons weekly. Mombasa is the world’s largest tea auction by volume and, in 1992, became the first tea auction outside London to sell teas from multiple origins. Sales of teas from ten countries are offered year-round. The auction handled as much as 545 million kilos before the pandemic, but volume fell to 482 million kilograms of tea in 2022.
ARC Mountain received the auction high of 92 cents per kilo of PF1 (Pekoe Fanning) grade tea. PF1 generated $10,265 in sales, averaging 87 cents per kilo. Secondary grades averaged 70 cents per kilo. Total sales were $24,024, according to Vision Tea Brokers.
Tea Board of Tanzania (TBT) Director General Mary Kipeja said the Dar es Salaam auction will lower costs, increase transparency, and make Tanzania a regional hub providing services to tea-growing countries in East Africa. Agriculture Ministry Permanent Secretary Gerald Mweli attended the auction and drew the praise of President Samia Suluhu Hassan.
The auction and related infrastructure improvements are part of the national 10-Year Industry Strategy adopted by Parliament. The program calls for increasing tea production from 33,000 tons of made tea to 90,000 tons annually by fiscal 2029/30.
Players in the value chain will benefit, including buyers, brokers, warehouse operators, and transporters, and the port facilities at Tanga and Dar es Salaam, said Kipeja. “More Tanzanians will also be enticed with interests in tea cultivation and management, increasing production and quality of the produce,” she said.
Sales of Tanzanian tea for export currently generate an average of $60 million in foreign exchange revenue. Direct employment is 50,000 and rising.
Holiday Shopping Sentiment Survey Foretells a Bleak Friday
By Dan Bolton
A YouGov survey of American shoppers finds 52% don’t plan to shop on Black Friday this year. Twenty-eight percent say they have shopped Black Friday deals in the past and will not do so. They were labeled “rejecters” in the survey analysis. Many will shop online on Cyber Monday, and others will wait for last-minute deals. Thirty-three percent remain enthusiastic and will shop again this year. In 2022, 73 million shoppers turned out, according to the National Retail Federation (NRF), which is down from the 84 million who shopped in-store in 2019. Concerns about personal finances led 24% of respondents who have shopped on Black Friday to skip it this year, reflecting declining consumer confidence.
The Conference Board ranking of Consumer Confidence fell to a five-month low in October, along with the first decline in retail sales decline since March. Hiring slowed, inflation eased, and economists confidently predicted the economy was cooling, not crashing (like they predicted this time last year).
Rising prices for everyday products, rising interest, and rising credit card debt are to blame. Accenture forecasts negative growth, citing that only one in five (17%) consumers feel optimistic about their financial situation.
Unemployment remains low, but fewer respondents said jobs were “plentiful,” and almost 14% of consumers said they could lose their jobs next year.
The New York Federal Reserve said credit card debt reached $1 trillion earlier this year, and nearly 60% of consumers are worried about their ability to get more credit.
The Wall Street Journal writes, “Retail figures aren’t adjusted for inflation, so slower spending partly reflects the cost for many goods that have fallen in recent months. Those include used vehicles, electronics, and groceries like milk and eggs. Any cooling in consumer demand will soothe worries that the summer’s spending surge would sustain higher inflation. A slowdown could raise hopes that inflation will return to its prepandemic norm without a recession, a so-called soft landing.”
In short, the holidays will be filled with cheer, but a Forbes reporter advised retailers that “V-U-C-A – volatile, uncertain, complex, and ambiguous – is the watchword for how retailers must approach this holiday season and 2024 after that.” The caution is attributed to the NRF, which predicted a sales increase of 6-8% last holiday season. Sales advanced only 5.3% in 2022. The NRF expects November and December sales to grow by 3-4% due to greater economic headwinds.
Tea retailers appear to follow the advice to promote the holiday season as early as September and not let up. High inventory is behind deep discounting as Black Friday looms. Tea Biz is talking to tea retailers and will report their results after US Thanksgiving.
Tea Barter: Egypt Offers Kenya a Blank Check
A shortage of foreign exchange dollars and a bounty of Kenyan tea led Egypt to propose a barter for un-named goods valued at parity. According to the UN COMTRADE database, Egypt imported $243 million of Kenyan tea last year.
Egyptian and Kenyan officials are meeting to reach a deal.
Eqypt is a major importer of black CTC (cut, tear, curl), spending $275 million annually. Kenya is the principal supplier, with an 89% share.
Last year, Egypt bought $8 million worth of tea from the UAE (accounting for a 3% share of tea imports), $8 million from Sri Lanka (also 3%), $2.6 million from India, and $2.5 million from China.
Tea imports, overall, have declined from a recent high of more than $345 million in 2014 to a pandemic low of $197 million in 2020.
Egypt and Kenya are both facing unprecedented scarcity of dollars, according to Ventures Africa. Since last October, the Kenyan shilling has lost almost 24% of its value against the US dollar. The Egyptian pound has declined 50% in value following three rounds of devaluation.
There is a long tradition of bartering agricultural products from Egyptian-grown rice, onions, garlic, nuts, cotton, essential oils, and citrus fruit. But experts say barter is unlikely to ease the hard currency crunch in Africa.
– Dan Bolton
FEATURE
Tanzania Tea Confronts an Array of Challenges with Zeal
By Dan Bolton
Tanzania is the third-largest tea producer in Africa. Smallholders farm 48% of the country’s 23,800 hectares under tea. Data from the Tea Board of Tanzania (TBT) estimates that 32,000 tea smallholders collectively produce about 40% of the country’s green leaf. The economy in this country of 68 million is mainly agrarian. There are approximately 3.7 smallholdings of 2.2 hectares or less. “The tea industry in Tanzania is currently going through several challenges and constraints. But the government of Tanzania has started taking very strong and robust measures to make sure that all these challenges are sorted out,” says Ndunguru.
Share Episode 143 | Holiday Consumers Lose Confidence Before Black Friday Sales Begin | YouGov Survey of American Shoppers Finds 52% Won’t Shop on Black Friday | Tanzania Debuts Digital Tea Auction in Dar es Salaam | Tea Barter: Cash Short Egypt Offers Kenya a Blank Check | PLUS Tanzania is the third-largest tea producer in Africa. Smallholders there farm 48% of the country’s 23,800 hectares under tea, producing 40% of the country’s green leaf. In October, I traveled to Dar es Salaam to talk with Tanzania Smallholders Tea Development Agency Director General Theophord C. Ndunguru and fellow tea board members to better understand the state of tea smallholders. This report is an excerpt from our discussion.
Holiday Consumers Lose Confidence Before Black Friday Sales Begin | YouGov Survey of American Shoppers Finds 52% Won’t Shop on Black Friday | Tanzania Debuts Digital Tea Auction in Dar es Salaam | Tea Barter: Cash Short Egypt Offers Kenya a Blank Check
Tea News for the week ending Nov. 17
Featured
Tanzania is the third-largest tea producer in Africa. Smallholders there farm 48% of the country’s 23,800 hectares under tea. Data from the Tea Board of Tanzania (TBT) estimates that 32,000 tea smallholders collectively produce about 40% of the country’s green leaf. As Director General, Theophord C. Ndunguru is the voice of the Tanzania Smallholders Tea Development Agency (TSHTDA). In October, I traveled to Dar es Salaam to talk with Theophord and fellow tea board members to better understand the state of tea smallholders. Today’s report is an excerpt from our discussion.
Tanzania conducted the inaugural Dar es Salaam digital tea auction this week, fulfilling a government mandate to stop exporting locally grown tea through the Kenyan port of Mombasa.
Four gardens sold a combined 1,320 packages (66,920 kgs), leaving 58% of tea unsold. Marks on offer include Arc Mountain, Chivanjee, Diddira, Kwamkoro, Kibena, Ikanga, and Itona.
The East Africa Tea Trade Association (EATTA), which runs the Mombasa tea auction, said the competing auction did not impact prices at its twice-weekly sales. The East African reported Mombasa could lose 25% of its current volume if Dar es Salaam meets its goal of selling 65,000 metric tons weekly. Mombasa is the world’s largest tea auction by volume and, in 1992, became the first tea auction outside London to sell teas from multiple origins. Sales of teas from ten countries are offered year-round. The auction handled as much as 545 million kilos before the pandemic, but volume fell to 482 million kilograms of tea in 2022.
Tea Board of Tanzania (TBT) Director General Mary Kipeja said the Dar es Salaam auction will lower costs, increase transparency, and make Tanzania a regional hub providing services to tea-growing countries in East Africa. Agriculture Ministry Permanent Secretary Gerald Mweli attended the auction, which drew the praise of President Samia Suluhu Hassan.
The auction and related infrastructure improvements are part of the national 10-Year Industry Strategy adopted by Parliament. The program calls for increasing tea production from 33,000 tons of made tea to 90,000 tons annually by fiscal 2029/30.
Players in the value chain will benefit, including buyers, brokers, warehouse operators, and transporters, and the port facilities at Tanga and Dar es Salaam, said Kipeja. “More Tanzanians will also be enticed with interests in tea cultivation and management, increasing production and quality of the produce,” she said.
Sales of Tanzanian tea for export currently generate an average of $60 million in foreign exchange revenue. Direct employment is 50,000 and rising.
Episode 143 | Holiday Consumers Lose Confidence Before Black Friday Sales Begin | YouGov Survey of American Shoppers Finds 52% Won’t Shop on Black Friday | Tanzania Debuts Digital Tea Auction in Dar es Salaam | Tea Barter: Cash Short Egypt Offers Kenya a Blank Check | PLUS Tanzania is the third-largest tea producer in Africa. Smallholders there farm 48% of the country’s 23,800 hectares and collectively produce about 40% of the country’s green leaf. As Director General, Theophord C. Ndunguru is the voice of the Tanzania Smallholders Tea Development Agency. In October, I traveled to Dar es Salaam to talk with Theophord and fellow tea board members to better understand the state of tea smallholders. Today’s report is an excerpt from our discussion.
In October, Transworld, China’s first USDA-certified organic tea producer, and Firsd Tea, the US subsidiary of Zhejiang Tea Group, released the Chinese Tea Sustainability Report, a 12-page survey of perspectives and practices at Chinese tea farms and processing facilities. The report tracks closely with Firsd Tea’s annual Sustainability Perspectives survey. Operators who responded generally comply with emerging traceability standards and guidelines by third-party certifiers, including the Rainforest Alliance, FLOCERT (Fairtrade International), and Fair Trade USA. Respondents from the nine provinces surveyed collectively produce 15 million kilos of mainly green tea on 12,000 hectares of land.
Listen to the interview.
Sustainable Tea Plays a Critical Role in Alleviating Poverty
By Dan Bolton
Jason Walker, 46, one of the architects of the sustainability report*, is the marketing director at Firsd Tea in New Jersey. His expertise includes business development, market research, and tasting. In June 2019, He testified at the US Trade Representative Hearings on behalf of the US tea industry in opposition to increasing tariffs on Chinese tea. “I really enjoy marketing as a bridge for sharing what’s new and relevant,” he says. “My connections to China and my work with Firsd Tea provide a great opportunity for thought leadership to and from the Chinese tea industry.”
Dan: Jason, let’s begin with some background on China as a responsible agricultural producer.
Jason Walker: In the past few years, China’s strategic plans have emphasized reducing pollution. More recently, they shifted towards food security. And they’ve said, ‘Let’s keep that green. Let’s keep that clean. But let’s alleviate rural poverty and bring in more food security as well.
Dan: China has demonstrated a long-term commitment to alleviating rural poverty. Describe the role tea plays.
Jason: When you take a more extensive view and look at what the UN says regarding global economic development and people emerging from poverty, much of that success can be attributed to what China has done within China. You’re talking about a lot of people that China by themselves; World Bank estimates range as high as 800 million — that China has helped get out of poverty.
Tea has been a useful way to do that because the tea product is a leaf, it is a stable, sturdy plant, you’re not tilling it up and planting something new, you’ve got a good product, you can learn you can train people on how to grow it well. And they have a regular crop every year to give a steady income.
It was a reason to develop a lot of rural areas. Because now you’ve invested in that leaf and the infrastructure, they need to be able to sell and produce that leaf.
China set [sustainability] standards, especially domestically, for tea. About 85% of China’s tea stays in China. They said, ‘We have to protect our people and raise our standards internally as well.’
Dan: Will you dig a little deeper into the specifics of the Chinese Sustainability report?
Jason: Our Sustainability Perspectives is a global report that looks at professionals from tea, coffee, and cocoa and compares their different perspectives.
What we saw was that a lot of people are still concerned about the environmental aspect of sustainability. They are worried that tea is more susceptible to climate change than other crops like coffee and cocoa. So that was a bigger concern.
But when we asked: What are you prioritizing in terms of sourcing products to sell? They’re still prioritizing taste, price, and leaf characteristics. In some cases, organic comes to the top above things like sustainability. So there seems to be a mismatch in priority, and maybe the talking points behind it.
Dan: How influential are the third-party certification partnerships that have been established? Transworld, for example, was China’s first USDA-certified organic tea producer.
So you’ve got Rainforest Alliance, you’ve got Fairtrade. They are active in China, although China isn’t their most well-known market or area of influence because China already has fairly high standards set by the government. Many Chinese producers already comply with pretty high standards to operate within their country, which makes it a little bit easier for fair trade certification to some extent rainforest as well to say that they’re already in compliance.
The end you must meet are EU standards for imports and US standards in terms of pesticide residue levels and, increasingly, overall traceability and more government requirements in places like the EU and the US in terms of protection of workers. Deforestation and other areas are becoming new laws in the pipeline.
Dan: In April 2018, Transworld and Zhejiang Tea Group donated 15 million green tea seedlings to villagers in 34 poverty-stricken areas across three provinces. Five years later, 1,800 households and more than 6,600 family members are thriving thanks to increased income from tea. Will you discuss the impact of the White Leaf Sustainability project?
Jason: Some research institutes in China and local and regional government organizations said, ‘We have healthy farms in Zhejiang province that are prepared to donate millions of tea seedlings or cuttings and distribute those within rural, underdeveloped areas in Western and Central China. And they brought those into those villages, and they not only showed villagers how to cultivate those plants, but they also invested in the local processing facilities.
They contracted in terms of committing to buy X number of kilos from those facilities. And marketed those teas as unique, valuable products that benefit these communities and build them up to be sustainable. As you said, it’s not just about the planet but also about the people.
Dan: What motivates the Chinese ag industry to strive for sustainable production?
Jason: They want their citizens to have a clean and healthy environment. They are looking for how they can ensure that our people are healthy, have good job opportunities, have growth, and feel that their products are safe. So that’s why they’re aiming even for zero growth in some pesticide applications. They have put more research into converting from the more conventional pesticides to biopesticides and non-traditional pest solutions, like light traps.
They’re doing the research and development stage where light traps had different wavelengths. Some attract the male insect, and some attract the female insect to keep them from mating. So they’re looking to cut back on the conventional to bring in more novel solutions to be sustainable, clean, profitable, and growing.
Dan: The report is an admirable effort to monitor tea sustainability globally, Jason. Let’s close the discussion with this open-ended question. What are pressing challenges, and what does the future hold?
Jason: First off, what I see for the future is that I think we can reduce the traditional conventional pesticides, especially where those are heavily monitored. We are exploring how to move towards bio-pesticides that are plant-derived or more naturally derived solutions.
How do we ensure the rest of the world is on board to recognize them as acceptable solutions and optimized practices worldwide? With that in mind, how do we protect people as their concerns about migration of people moving, how does that affect tea harvesters who are moving around to different harvest locations, and how will they be looking at the timing that affects the seasons and harvest times?
So, this year, 2023, has been better so far than 2022.
The Meteorological Society, from what I’ve heard, is discussing how to provide better projections and practical advice to the farmers — what to prepare for, how to adjust your pruning, how irrigation may be maybe improved in terms of rain retention ponds, drainage channels, or ditches that capture more moisture, those types of things.
Generally, everybody in tea doesn’t want to rock the boat by saying changes in climate are affecting quality — yet. They feel we can still make the most out of what we’re doing.
There are lots of issues to work on. There’s a great opportunity to touch on all those things if we, as we talked about in the studies, can all get on the same page in terms of communicating about these things, sharing our concerns, and working on shared solutions.
Respondents Most Commonly Mentioned These 5 Themes
Consumer Demand – “All actors in the supply chain need buy-in. Consumers want [sustainability] but don’t want to pay for it. This forces producers to comply with standards without getting increased pricing.”
Quality of Life for Workers at Origin – “Paying a living income to the industry, especially smallholders, will help promote sustainability practices.”
Better Farming Education – “More education and training to farmers.”
Environmentally Responsible Practices – “Using more eco-friendly methods of farming and processing.”
Improve Regulatory Programs – “… sustainability certification programs must engage with the local laws, tea research bodies, and technological experts. By doing so, they can provide meaningful benefits to tea farmers and ensure their economic sustainability.
Consider…
Research done by Stanford University suggests that helping smallholders optimize their use of pesticides could be a big win in terms of reduced environmental impact. Globally and in China, the majority of tea is farmed by smallholders.
*The Sustainability Perspectives report derives its findings from a three-month-long survey administered by Crothers Consulting to 100 voluntary respondents conducting business in tea and related industries(e.g., coffee, sugar cane, wine, and cocoa) on behalf of Firsd Tea. Survey responses were primarily generated by website posting and subscriber outreach by Firsd Tea and The Tea& Coffee Trade Journal, direct messaging on platforms like LinkedIn, and word-of-mouth networking. Industry-specific organizations, including the Tea and Herbal Association of Canada, promoted the survey by sharing it with virtual conference-goers.
Share this post Jason Walker, Marketing Director at Firsd Tea in New Jersey and one of the architects of the newly released Chinese Sustainability Perspectives report joins Tea Biz for an in-depth discussion of the results of this ongoing survey.
Even as the industry reports a nearly 10% decrease in tea exports this year, brought about by the loss of the Iran market, the war in West Asia, and the Russia-Ukraine conflict, there has been good news. India now sees three new markets in Iraq, Jordan, and Turkey, replacing their traditional source, Sri Lanka. The work to develop these markets has been ongoing for a while. In 2021, the Baghdad Chamber of Commerce invited India to participate in the country’s first-ever tea festival. In 2022, Indian tea exports to Turkey were valued at $7.36 million, according to the United Nations COMTRADE database on international trade. As for Jordan, over the past four years, there has been substantial growth in Jordan’s exports to India, especially with phosphates and potash, while imports from India include coffee, tea, spices, sugar, grains, meat, and fish.
New Association of Auctioneers
Auctioneers across India have decided to collectivize as the Association of Tea Auctioneers. With 40% of the Indian tea production sold via auctions, it seems that auctioneers felt the need to unite to promote and safeguard their rights and interests. Thirteen auctioneers have come forward to form the ATA, launched on November 10th with a ceremonial manual auction at the famed Nilhat House in Kolkata. 795 lots of orthodox Assam tea was on offer with Gaurav Ghosh, Vice Chairman of J Thomas and Co., as the auctioneer for the day. Buyers were almost all exporters, and the auction took place over 6 hours. Bringing back the manual auction for a day was also to celebrate how auctions used to take place before the industry transitioned to e-auctions. The ATA has proposed to design and operate a new auction system if the government approves.
Folk Tea Festival
Journalist Mrinal Talukdar is set to host the 3rd Folk Tea Festival in Assam this month. Spread over three days, the festival takes place at the Hatipoti Tea Estate near North Bank, Assam. It’s organized in a small tea garden and is a festival promoting folk music, local culture, and tea. This year, the festival is scheduled for November 24th to 26th. Those interested can book via the website Folktea.In where the schedule, accommodation options, and events are listed.