• Tea Biz Podcast | Episode 33

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    Listen on your favorite player

    Hear the Headlines

    | Timely Tea Delivery Faces Troubled Waters
    | Tea is Thriving in the Convenience Channel
    | Iran Tea Production Increases 25 Percent

    Seven-minute Tea News Recap

    Tea Price Report
    April 28 – Sale 34

    India Tea Price Watch

    Assam’s annual floods have arrived this week with 16 districts affected. India’s Ministry of Commerce also suspended seven sections of the Tea Act, 1953. It appears several reforms are underway to lift regulations, including the recent relaxation of norms to obtain export and distribution licenses. – Aravinda Anantharaman

    Features

    This week Tea Biz puts Burmese chefs in the spotlight for their culinary contributions to tea.

    … and then we travel to London where Unilever unveiled four guiding principles of regenerative agriculture a topic currently trending in tea.

    Regenerative Agiculture

    By Dan Bolton

    Can a world that has already eroded a third of the planet’s soils feed a population of 10 billion without intensive agricultural practices that rely on heavy inputs of fertilizer, herbicides, and pesticides that sustain monoculture farming?

    To answer this question, the Tea Biz Podcast and Blog is undertaking a series of interviews with thought-leaders in tea from organizations such as the Rainforest Alliance, growers in Sri Lanka, where a nationwide ban on the import and manufacture of plant chemicals was instituted in May; and with multinationals like Unilever, a company with extensive tea holdings that recently unveiled its basic principals of regenerative agriculture. Read more…

    • Next in the series is a conversation with the Rainforest Alliance on how regenerative agriculture differs from sustainable farming.
    Listen to the Interview
    First in a series of podcasts on regenerative agriculture
    Laphet Thoke
    Laphet Thoke, fermented tea leaf salad.

    Tea Leaf Cuisine

    By Aravinda Anantharaman

    Pickled tea leaves may sound a bit out of the ordinary but not for Southeast Asian chefs. Burma, now known as Myanmar, is an ancient crossroads influenced by the cuisine of bordering Bangladesh, China, Thailand, and Laos. It is here that laphet has become a national dish that is now finding its way to US and European consumers as branded packaged goods. Learn more…

    Listen to the review
    Aravinda Anantharaman on the versatility of tea.
    Imports in TEUs are approaching 550,000 per month at Los Angeles area ports, far exceeding totals for the same January through July period during the past four years. In August idled ships numbered a high of 44.

    Timely Tea Delivery Faces Troubled Waters

    By Dan Bolton

    The disruption of global supply chains is getting worse. Container vessel reliability for tea shipments crossing the Pacific continued to decline this summer as prices reached new heights. The World Container Index for eight East-West routes rose to a composite cost of $9,613 for the week of August 19 – up 360% compared to the same period last year. Consignments of tea shipped from Shanghai to Rotterdam increased 659% to $13,698 last week. Sobhanadri Jonnalagadda at Spisys Ltd. in Telangana, India, reports that the cost of booking a container destined for Hamburg from Hyderabad increased from £3000 to £9000.

    Port congestion, backlogs at container terminals locked down to prevent the spread of the coronavirus, and rapidly increased volume dashed hopes for a return to normalcy until next spring. Logistics costs considered manageable by tea wholesalers early this year are now seen as out of control. Inflation is a growing concern, but the unpredictability of delivery dates is causing far greater problems.

    Green tea exporter Zhejiang Tea Group’s US operation, Firsd Tea, advises tea buyers to calculate projected inventory needs for at least six months and consider adding 20% to projected volumes to avoid out-of-stock conditions and transportation delays.

    This week there were a record 44 container vessels trying to offload at Southern California ports, an all-time high. And ports are getting busier as the holidays grow near. Imports in TEUs are approaching 550,000 per month at Los Angeles area ports, far exceeding totals for the same January through July period during the past four years.

    On arrival shortages of dockworkers, crane operators, warehouse staff and qualified truckers cause further delays. Driver shortages are at all-time highs forcing companies to offer incentives. Qualified drivers are now earning $27 per hour. FreightWaves reports that refrigerated carrier J.S. Helwig & Son increased pay 4 cents to 62-cents per mile for experienced drivers – that’s $1240 for a 2,000-mile round trip. New hires earn 50 cents per mile and a $1000 signing bonus.

    Biz Insight – The likelihood of a ship arriving on time was better than 80% in 2019 is now “hovering around 40%”, according to logistics analysts Sea-Intelligence. Add port and trucking delays and buyers this fall (whether they are consumers ordering Christmas tea online or wholesalers booking containers) — will experience delivery times extended by four to six weeks.

    Foxtrot online for delivery nationwide and locally with a 60-minute guarantee, soon to be 30 minutes.

    Tea is Thriving in the Convenience Channel

    By Dan Bolton

    Convenience outlets thrive at locations near where people live and in 2020 people stayed close to home.

    In-store sales at US grab-and-go outlets rose for the 18th year in a row to $255 billion in 2020. Beverage sales are a top category, accounting for 20% of all sales. Ready-to-drink iced tea makes up about 5% 4.7% of that total, trailing soda, juice, energy drinks, and bottled water, according to the National Association of Convenience Stores (NACS).  

    New York-based Nielsen reports that overall, tea grew by 11.1% through April 2021.  During that period liquid tea generated $3.4 billion in sales, RTD tea earned $142 million. Green tea sales were up 72.7% during the pandemic to $18.6 million, Nielsen.

    In 2020 the dramatic decline in commuter trips, lockdowns and a consumer shift to grocery and home meals increased their spend but cut trips to convenience stores by more than 20%, according to NACS. The number of transactions declined 14% as basket sizes grew 18% compared to 2019.

    The pandemic had a huge impact on self-serve beverages. Hot dispensed sales fell 33.4%, and cold dispensed beverages declined 7.9%, reflecting the drop in footfall amid stay-at-home orders and work-from-home schedules, writes NACS. In contrast, beer saw unprecedented growth accounting for 6.3% of total convenience store sales due to the closure of bars and restaurants (only 12.4% of 150,000 US convenience stores are licensed to sell beer).

    Market research firm Technomic writes that US beverage sales overall declined 31% by volume in 2020. Spending declined 29% with cold dispensed beverage volume down 30%.

    Biz Insight – Foxtrot markets, an upscale convenience chain is known for its 60-minute delivery guarantee “is the corner store reimagined” says venture capitalist David Barber. Stores feature locally baked treats, coffee, freshly brewed tea, and organic wine, craft beer, gifts, and everyday essentials.

    Foxtrot is an upscale, hyper-convenient convenience chain

    CEO Mike LaVitola told Forbes that half of the company’s transactions occur online for delivery nationwide and half in-store. He said the company intends to introduce hyper-convenient 30-minute delivery and expand its selection of private-label convenience items in larger, 4,000 square foot stores.

    The start-up has raised $65 million in January from the likes of former Whole Foods Market CEO Walter Robb and Momofuku restaurant founder David Chang. The chain, founded in 2014 in Chicago, currently has 13 locations with nine to open in 2021 and 50 within two years. New locations include Dallas and Washington DC and Austin, Tex., Boston, Miami, Los Angeles, and Houston.

    Harvesting tea in Gilan, Lahijan province, Iran

    Iran Tea Production is Up 25 Percent

    Iran’s Tea Organization (ITO) reports a 25% increase in tea production so far this year and higher export numbers as well. During the first five months of the year, Iran harvested 114,445 metric tons of raw leaf, valued at 6.5 trillion rials (about $155 million US), according to ITO. The tea organization considers 51% of the harvest premium grade, down from 79% in 2020.

    Iran is a net tea importer, No. 6 in the world, spending $236.3 million on tea in 2020, according to World’s Top Exports.

    In recent years growers began exporting increasing quantities of tea. In 2020 4,000 metric tons of teas were shipped to 12 countries regionally including Azerbaijan, Afghanistan, and Iraq, India, Tajikistan, Turkmenistan, and Georgia as well as Canada, Australia, Spain, and the Czech Republic. In 2020 tea exports averaged 86 cents per kilo. Sales totaled $6.5 million, up 2.6% compared to 2019.

    Iran’s tea industry employs 55,000 families cultivating tea on 70,000 acres [28,000 hectares].

    — Dan Bolton

    Upcoming Events

    September 2021

    Level Up, Virtual
    September 29 | The Tea & Herbal Association of Canada will host a mid-year Meet-Up from 10 am to noon. Admission $55 (CAD) Members $50. Agenda | Register

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  • Tea Biz Podcast | Episode 32

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    Hear the Headlines

    | Afghan Tea Market Concerns as Taliban Conquers Kabul
    | Foodservice Recovery Rates Vary Widely by Sector
    | Researchers Confirm Heart Healthy Aspects of Tea

    Seven-minute Tea News Recap

    Tea Price Report
    April 21 – Sale 33

    India Tea Price Watch

    Afghanistan is an importer of green and orthodox black tea from India and in 2020-21, about 760,000 kilos of tea was exported from there. At the moment, the movement of cargo between the two countries stands interrupted. – Aravinda Anantharaman

    Features

    This week Tea Biz visits Darjeeling, India on word of the sale of the iconic Jungpana and Goomtee tea estates to Anshuman Kanoria, principal at Balaji Agro International and chairman of the Indian Exporters Association

    … and then to London where Kyle Whittington reviews The Tea Girl of Hummingbird Lane, a novel by Lisa See.

    Anshuman Kanoria discusses his company’s acquisition of two of Darjeeling’s best-known tea gardens.

    Restoring Darjeeling’s Reputation from the Roots Up

    By Aravinda Anantharaman

    The sale of two iconic Darjeeling tea gardens focused attention on the ongoing challenges facing growers in this fabled tea-growing region. Jungpana and Goomtee were acquired by the Santhosh Kanoria Group, which owns the tea export company Balaji Agro International. The group also owns Tindharia estate in Darjeeling. We spoke to Anshuman Kanoria, Chairman of Balaji Agro and Chairman of the Indian Exporters Association about this acquisition. Read more...

    Listen to the Interview
    Anshuman Kanoria on India’s unrealized potential in tea
    Lisa See has written a “brilliantly layered book” writes Whittington

    The Tea Girl of Hummingbird Lane

    By Kyle Whittington | TeaBookClub

    New York Times best-selling author Lisa See has written several novels revealing her fondness for tea. The Tea Girl of Hummingbird Lane, however, uniquely explores the mysterious world of Pu’er. Reviewer Kyle Whittington writes that See’s novel “consists of so many brilliant layers… for the tea reader this is a wonderful story, packed with great tea content that will either develop or ignite an interest in, and a desire to explore the world of Pu’er.” Read the review…

    Listen to the review
    Kyle Whittington reviews The Tea Girl of Hummingbird Lane
    A tea break for Afghan farmworkers. Afghans annually drink 1500 cups of tea per capita. Kahwa (a tea and spice blend) and green tea with mint are favorites. Photo by © Karl Allen Lugmayer | Dreamstime.com

    Afghan Tea Market Concerns as Taliban Conquers Kabul

    By Dan Bolton

    Afghanistan is a major tea-consuming nation and a smuggler’s paradise for tea. The country became a profitable middleman by clever manipulation of border regulations that were only recently reined in after decades of openly flaunting Pakistani Customs enforcement.

    Since tea trades in US dollars, money in Taliban controlled bank accounts is frozen. Bank withdrawals are limited and in-bound remittances from Western Union and MoneyGram have stopped. The East African Tea Trade Association (EATTA) reports bidding at the Mombasa auction on tea bound for Afghanistan slowed as the Taliban occupied Kabul but EATTA explained that Afghanistan gets its Kenyan tea via Pakistan where there have been no disruptions at all, according to The East African. Shipments between India, another major source of tea, and Afghanistan were halted this week.

    Afghanistan’s banks are closed, halting direct deposits for salaried workers. Interbank transfers are subject to sanctions imposed by western powers decades ago to curtail terrorist activity. The Financial Action Task Force, warned member countries they must ensure that “no funds or other assets are made available, directly or indirectly” to the Taliban or face fines and censure by the United Nations and the US along with many of its allies. During the 20 years since the Taliban was last in power, many businesses transitioned from cash and writing checks to digital banking. Prices for basic commodities like bread, oil, and tea have doubled since the government collapsed and the economy is in freefall.

    In 2020 foreign aid from the US and Europe accounted for 43% of the economy. Remittances from Afghans living outside the country were nearly $800 million last year, according to the Wall Street Journal. Given near universal sanctions due to a global blacklisting of the nation’s central bank, the Taliban will find it difficult to borrow or trade essential commodities, making taxes on citizens and local businesses the Taliban’s sole source of funds in a $22 billion economy.

    It is too soon to know how the collapse of the Afghan government and the return of the Taliban will alter the tea market, but smuggling was rampant during the 1996-2001 Taliban regime. In Helmand province, traders said that “if we smuggle 40kg (heroin), we give the Taliban 4kg.”

    Pakistan Customs lists black tea and green tea as two of the five most smuggled commodities. Tea exports to Pakistan surged in 2020, increasing 18.7% in value compared to 2019, making it the world’s highest-valued tea import market at $590 million. Kenya accounted for $497 million of last year’s import spend, growing 27% following a decision by the Indian government to no longer export tea to Pakistan.

    Afghans prefer green tea to black, yet hundreds of thousands of kilos of black tea are landed annually at the Port of Karachi, Pakistan. Until recently Pakistan charged a combined 38% tax and duties on tea making the import cost of tea 32% higher than tea imported into Afghanistan. Afghanistan is a landlocked nation so huge quantities of African tea, mainly from Kenya, are delivered to the Pakistani port tax-free, taxed at a low rate at the Afghan border, and then transported to large warehouses where it is broken into retail packets and smuggled into Pakistan. Smugglers pay a 12%-15% bribe and transportation cost, pocketing the difference.

    Biz Insight – Pakistan’s Competition Commission considers smuggling to be “the biggest threat faced by the domestic tea industry, causing loss of millions of rupees to the government and forcing legal importers out of business,” according to a 2019 report. A crackdown on violators in late 2020 led to a 55% increase in customs duties collected (a proxy for illegal trade) and evidence of a concerted effort by Pakistan to decrease the cost of legal imports, making smuggling unprofitable.

    It will take years to rebuild some US foodservice sectors to 2019 consumer spending levels.

    US Foodservice Recovery Rates Vary Widely by Sector

    By Dan Bolton

    Sales at Quick Service Restaurants (CSR) and the Supermarket Prepared Foods segment are well ahead of pre-pandemic totals but “everyone in foodservice is starting from a really different point,” reports Ann Golladay, senior project director at Datassential Research’s Baltimore office.

    Datassential calculates that — overall — consumer spending in foodservice declined from $806.7 billion in 2019 to $701.4 billion in 2021 and will not return to pre-pandemic spending levels until 2023.

    Golladay explained to webinar participants Aug. 19 that Fast Casual, once the darling of the industry with the largest real growth will not reach pre-pandemic spending levels before 2023 “and that will be nominal growth that does not include inflation,” she said. Golladay estimates inflation at 5% per year “so you will probably have to back down these projections 10% by then,” she said. Consumer spending at fast casual restaurants declined 19% in 2020. The segment is projected to generate $67.4 billion next year compared to almost $68.7 billion spent in 2019.

    A survey of the nation’s grocers found that 74% reported increased sales in 2020. The consumer spend for prepared foods at supermarkets in 2022 will be $38.8 billion, rising by 119% compared to 2019 dollars.

    Recreation, lodging, and convenience store foodservice segments will take even longer to recover. Lodging, for example, will have only achieved 71% of its 2019 consumer spend by 2022.

    Until workers return to downtown offices, the business and industry foodservice sector, projected to reach pre-pandemic sales of $6.9 billion, will never recover.

    Tea Biz Insight – Jack Li, principal at Datassential identified five “x-factors” that could disrupt the official projections. These include new variants, vaccine mandates, additional and extended lockdown, sustained inflation, and a combination of labor and supply chain bottlenecks.

    Tea flavonoids reduce risk and severity of adverse cardiovascular events.

    Researchers Confirm Heart Healthy Aspects of Tea

    By Dan Bolton

    Accumulating evidence of tea’s heart health benefits led researchers to conduct an umbrella review describing and critically evaluating the totality of medical evidence to date.

    Their findings: “It is reasonable to judge that two cups of unsweetened tea per day has the potential to decrease CVD (cardiovascular disease) risk and progression due to its flavonoid content.”

    The peer-reviewed paper authored by Abby Keller and Taylor Wallace and published in the Annals of Medicine, examines 10 years of studies, from 2010 to 2020, that identify several biological mechanisms showing a decreased risk and severity of cardiovascular disease in tea drinkers.

    The authors write that “Results of population studies commonly suggest that tea consumption is inversely associated with several health outcomes. Shorter-term clinical intervention studies provide additional evidence that tea consumption has the potential to affect intermediate outcomes and biomarkers of disease in healthy, at-risk, and diseased populations.”

    Based on this umbrella review, the researchers observed that the consumption of tea as a beverage “did not seem to be harmful to health; therefore, the benefits of moderate consumption likely outweigh risk.” 

    In Memoriam

    Miriam “Mim” Enck, president of The East Indies Coffee & Tea Company, in Lebanon, Penn., passed away Saturday, Aug. 14 after a short illness. Since 2018 Enck has operated the company founded by her late husband, Walter Progner who started the specialty tea retail business in 1976. She was 75.

    Upcoming Events

    August 2021

    POSTPONED: Beijing International Tea Expo, Beijing China
    August 27-30, 2021 | Beijing Exposition Center (the recent coronavirus outbreak forced Beijing authorities to halt all events that attract large crowds. Watch this space for new date when it becomes available.)

    September 2021

    Caffé Culture Show, Business Design Center, London
    September 2-3 | The European Speciality Tea Association will host a Speciality Tea Hub on the exhibition floor with a tea brew bar, a members’ lounge, educational seminars and small exhibitor pods.  Admission is free | Program | Register

    Level Up, Virtual
    September 29 | The Tea & Herbal Association of Canada will host a mid-year meet up from 10 am to noon. Admission $55 (CAD) Members $50. Agenda | Register

    Click to view more upcoming events.

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    Subtext

    Avoid the chaos of social media and start a conversation that matters. Subtext’s message-based platform lets you privately ask meaningful questions of the tea experts, academics and Tea Biz journalists reporting from the tea lands. You see their responses via SMS texts which are sent direct to your phone. Visit our website and subscribe to Subtext to instantly connect with the most connected people in tea.

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  • Tea Biz Podcast | Episode 26

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    Hear the Headlines

    | Darjeeling Experiences a Severe Downturn
    | Researchers Discover Expanded Role for Microbes in Tea Making
    | Oxfam India Defines Living Wage for Assam Tea Workers

    Seven-minute Tea News Recap
    Tea Price Report

    This week, the focus is on declining tea exports from India, which is a cause of concern to the industry. The tea associations have issued a press release that the industry is bracing for a decline of 30-40 million kilos this year, compared to 2020. Read more…

    Features

    Tea Biz this week travels to South Africa to discuss with Carmién Tea founder Mientjie Mouton the beneficial aspects of the European Union’s decision to register rooibos as the first African food product to receive protected designation of origin.

    … and then to Scotland where Dananjaya Silva discusses with nine local tea growers how the short summers and cold winters of a far northern terroir contribute to the unique flavor of Scottish tea.

    Carmién Tea founder Mientjie Mouton
    Carmién Tea founder Mientjie Mouton walks a field of rooibos

    Rooibos Revived

    By Dan Bolton

    Carmién Rooibos Tea founder Mientjie Mouton explains the significance of the European Union’s decision to award Protected Designation of Origin (PDO) to rooibos, a registration that attests to the authenticity and commercially guards traditional processing methods to protect suppliers in the region where unique products are grown. Read more…

    Carmién Rooibos Tea founder Mientjie Mouton
    Catherine Drummond-Herdman at her Megginch Castle tea garden.

    Scottish Tea

    By Dananjaya Silva | PMD Silva

    Scots have a long history of growing Camelia sinensis in faraway lands ? from the jungles of Assam to the hills of Ceylon. A group of Scottish ladies have decided to follow in their ancestor’s footsteps by banding together as the Tea Gardens of Scotland. I’m Dananjaya Silva from PMD David Silva & Sons, and today I sit down with Kate Elliot, Catherine Drummond-Herdman, Pinkie Methven, and Veronica Murray-Poore to talk about tea grown from seed on micro tea plantations in Perthshire, Fife, and Angus Scotland. Learn more…

    Tea growers in Scotland discuss their tea gardens and aspirations for Scottish tea
    Darjeeling’s tea planters are experiencing difficult times.

    Darjeeling Experiences a Severe Downturn

    By Dan Bolton

    The West Bengal tea community that surrounds Darjeeling is experiencing difficult times. Only 45 of the 87 tea gardens within the protected geographical origin are routinely auctioning tea. Production has declined from 16 million kilos 15 years ago to fewer than 7 million kilos in 2021.

    Tourists are few. As COVID-19 infections decline elsewhere, the pandemic persists in the foothills of the Himalayas forcing travel restrictions. There were 1,500 active cases last week, with 88 new infections on July 8, a number greater than Kolkata recorded that same day.

    In June, the Telegraph India reported that more than 10% of Darjeeling’s tea gardens were up for sale but saw no buyers. Absenteeism, political turmoil, and climate change are often cited as reasons, but the main concern is the declining volume in production.

    Rajah Banerjee, the heir to Makaibari Tea Estate, describes the situation with clarity and insight. “Darjeeling now faces a large-scale decline,” he writes.  “Commercially, Darjeeling tea has been weathering a waning export market, explained by outdated management practices and exploitative middle-men. But there is a far more powerful factor at work now — the region’s ecology was already facing deforestation, making the seismically sensitive area vulnerable to topsoil loss and land-slides. Pushing the tea gardens closer to the edge now, climate change is bearing down on tea yields, impacting the livelihoods of thousands in the industry.

    “As emissions rise, intensifying global warming, changes in the melting of the Himalayan glaciers are causing temperature rises in Darjeeling — this has led to insect proliferation which damage the crop. Alongside, a lack of precipitation during dryer winters and unseasonal inundations during plucking seasons have drastically changed our harvesting window, reducing an eight-month harvest period to just six. Uniquely, Darjeeling is the world’s only region that produces teas in four seasonal ‘flushes’ or harvests. While each has its distinctive flavor, color and aroma, the four flushes share one common thread — the regularity of the seasons themselves. Currently though, between prolonged droughts and unusual rain, tea growers are facing erratic and shrinking yields,” he writes.

    Tea Board data shows that in 2020, Darjeeling’s production stood at 6.7 million kilos. This year, the second flush which makes up 20% of the annual production is seeing a reported decline of 200,000 to 300,000 kilos. April-May 2021 production stood at 1.22 million kilos (Source: Tea Board of India) 

    Biz Insight – News of gardens being sold has been recurring from this region. In 2020, the Singbulli and Nursing Tea Estates were sold. Okayti in June is the latest estate to be acquired. The 1600-acre high-altitude estate operates a factory that dates to 1888. The new owners are local and offer a hopeful vision of Darjeeling whose first concern is serving the domestic market. The estate was sold to Chai Chun, a unit of Siliguri-based Evergreen Group, a firm that operates Chai Rasa cafes and boutiques. Founder Rajeev Baid envisions a world-class tea academy to draw students of tea culture and tourists to an estate that produces organic tea using orthodox process as well as cut, tear, curl packet tea. The company processes 15 million kilos of tea across a broad range of 165 varieties supplying premium and bulk tea in quantities that benefit from scale.

    Expanded role of microbes in tea making

    Researchers Discover Expanded Role for Microbes in Tea Making

    By Dan Bolton

    The oxidation of tea leaves during orthodox processing is essential but not exclusively responsible for the flavor in tea.

    The finding that bacterial and fungal communities also drive tea processing suggests the microbiome of the leaves can be manipulated to create greater quantities of tasty compounds due to fermentation.

    A team of researchers at Anhui Agricultural University in China cleverly demonstrated that black teas, withered, rolled, and oxidized before drying are less flavorful when sterilized. Their paper, Black Tea Quality is Highly Affected during Processing by its Leaf Surface Microbiome, which was published in the June issue of the Journal of Agricultural and Food Chemistry, shows that microbial fermentation, present in non-sterilized control samples, produced tea with lots of catechins and L-theanine, an amino acid specific to tea. Tea made from the oxidized but sterile leaves was less flavorful and lacking in many of the complex compounds that tasters identify in premium teas.

    The experiment showed that caffeine and theanine were found in the same quantities in green tea with or without leaf surface sterilization. “However, the sterilization process dramatically decreased the content of total catechins and theanine in black tea, indicating that microbes on the surface of tea leaf may be involved in maintaining the formation of these important metabolites during black tea processing,” according to Prof. Ali Inayat Mallano.

    Oxfam India Defines Living Wage for Assam Tea Workers

    Oxfam India, a confederation of 20 independent charitable organizations, released a study last week that determined the minimum living wage for tea workers in Assam is INRs 887 rupees (about $12 per day). Workers make far less per day and are working fewer days due to COVID-19 restrictions. Only 39% of workers can be considered as permanent, the remaining 61% contract their services with fewer benefits. The study calculated a minimum of INRs 285 per day for food for a family of four and INRs 599 for non-food expenditures.

    Biz Insight – The study of 5,000 tea workers in seven districts was conducted in October through December 2020. Oxfam CEO Amitabh Behar in appealing for improved wages described “a stark gap between the current wagers that tea workers receive vis a vis the living wages that has been calculated.”

    – Dan Bolton

    Learm more…

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    Avoid the chaos of social media and start a conversation that matters. Subtext’s message-based platform lets you privately ask meaningful questions of the tea experts, academics and Tea Biz journalists reporting from the tea lands. You see their responses via SMS texts which are sent direct to your phone. Visit our website and subscribe to Subtext to instantly connect with the most connected people in tea.

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  • Tea Biz Podcast | Episode 24

    Tea Biz Podcast Logo

    Hear the Headlines

    | Logistics Companies Invest to Right the Ship
    | Kenya’s Newly Elected KTDA Board Ousts Executives
    | Hain Celestial Streamlines its Tea Selections

    Seven-minute Tea News Recap
    Tea Price Report

    A special auction conducted by the Tea Board of India across auction centers featured a carefully curated catalogue of teas, plucked on the International Tea Day on 21st May. This special sale saw record prices that brought welcome energy and excitement to the industry. Read more…

    Features

    Tea Biz this week travels to Darjeeling, India where Dorje Tea, an innovative new tea venture is taking root at the Agarwal family’s ancestral farm at Selim Hill Tea Garden … and then to the Jersey Isles off the coast of France where Alicia Gentili, project manager and tea maker at Jersey Fine Tea, discusses the challenges and rewards of establishing a new tea garden in the English Channel.

    Dorje Tea co-founders Sparsh Agarwal and Ishaan Kanoria, right.

    Reviving Darjeeling

    By Aravinda Anantharaman

    Sparsh Agarwal is the fourth generation in his family to cultivate tea in the Himalayas but, as you will hear, he is not bound by tradition. Agarwal and Dorje Tea co-founder Ishaan Kanoria are targeting India’s domestic market, offering a subscription model that delivers Darjeeling tea from all four plucking seasons that will improve profitability and give Selim Hill Tea Garden a second chance.  Read more…

    Sparsh Agarwal on marketing Darjeeling’s seasonality domestically
    Alicia Gentili, project manager and tea maker at Jersey Fine Teas

    Splendid Tea from the Isle of Jersey

    By Dananjaya Silva | PMD Silva

    Camellia sinensis is a versatile plant that is grown in many parts of the world, observes Tea Biz correspondent Dananjaya Silva. At 49 degrees latitude, Jersey, the largest of the Channel Islands situated between England and France, is much further north than traditional tea lands, yet the island is proving to be fertile ground to produce fine loose-leaf tea. Silva talks about the challenges of growing tea outside its comfort zone with project manager and tea maker Alicia Gentili from Jersey Fine Tea. Read more…

    Alicia Gentili on growing tea on the English Channel Island of Jersey
    MSC Ship
    MSC operates the world’s second largest container fleet by TEU

    Logistics Companies Invest to Right the Ship

    By Dan Bolton

    Shortages of raw ingredients for beverages and higher shipping costs continue the saga of supply chain woes into summer. Last week Starbucks’ customers found green tea in short supply along with chai tea bags and oat milk. No single item has disappeared from the menu, but Reuters found temporary shortages at nine major fast-service chains are widespread.

    Less obvious are the costs passed along due to more expensive air and sea transport and a shortage of truckers. Reserving a 40-foot container to ship tea from Shanghai to Los Angeles cost $6,368 in June, according to the Drewry Freight Rate Index. Delivery to Chicago from Shanghai normally takes 35 days (including 33 at sea) but shippers now estimate 73 days for delivery as port-to-destination times have doubled. When premiums are added to secure equipment and vessel space is included, the effective West Coast rate for landing tea from China ends up being about $8,000 to $11,000 per FEU (forty-foot equivalent unit), according to the Journal of Commerce.

    At the consumer level, this means online orders for tea must now meet $50 and $75 thresholds to qualify for free shipping and that four-week delays are common. Observers predict that the kinks in the supply chain will persist through 2022.

    Biz Insight – Global container fleets are consolidating as shipping companies put new-found money to work acquiring vessels and ordering containers. Swiss-owned MSC (Mediterranean Shipping Company) has acquired 70 ships since August and has an orderbook of 800,000 TEU for new ships. The buildup in demand shows no sign of abating as consumers spend pandemic savings and economies emerge from lockdowns.

    Kenya surge
    Kenya is home to 658,000 tea smallholders

    Newly Elected KTDA Board Ousts Executives

    Newly elected Kenya Tea Development Agency (KTDA) directors and chairman David Muni Ichoho on June 22 were escorted by police to their offices in the KTDA headquarters in Nairobi.

    KTDA’s Peter Kanyago, who had been at the helm of the tea agency for 26 years, was forced to relinquish his position after he was unseated in a local election April 25. KTDA CEO Lerionka Tiampati and other senior staff were given compulsory leave. Ichoho announced an internal investigation to determine culpability for potential malpractice and possible abuse of office.

    Kenya’s tea farmers collectively own 66 of the nation’s tea factories. They contract with the Kenya Tea Development Agency (KTDA) to pay for what they produce and to market their tea.

    During the past two years local concerns about a ‘tea cartel’ and a new administration in Nairobi led to legislative reforms that permit factories to replace directors by conducting special elections. The previous system awarded votes by share. Board members found they only had to please the largest farmers. Now it’s one man, one vote. Ousted board members challenged the Tea Act, 2021 in court and consider any special elections conducted between March and May invalid.

    Ichoho’s first official act was to notify the organization to accord full recognition and cooperation to the new board as it takes over factory management, “We wish to assure all stakeholders that the operations of the group are running smoothly without any interruptions.”

    He told the Kenya News Agency that “Procurement contracts will also be reviewed to ascertain value for money and determine if the services and goods were obtained within the market benchmarks.”

    “The reform journey began in earnest on 14th January 2020, with the directives by His Excellency the President of the Republic of Kenya, following outcry by over 658,000 farmers over dwindling fortunes as it became clear that the tea value chain governance structures had been captured by some individuals and groups of persons for their own selfish interests at the expense of the principal stakeholders – the tea farmers,” said Ichoho.

    He said KTDA abdicated their core responsibility of serving the best interests of the farmers.

    “It is against this background that shareholders made a decision to exercise their rights to make leadership changes with a view to charting a new direction towards a sustainable and profitable farming in tea sub-sector for smallholders. The farmers, towards this objective undertook to elect new leaders from the shareholders as Factory Directors and Board members for the KTDA Holdings,” Ichoho said.

    A spokesperson at a non-violent late-night protest predicted that a case before Kenya’s Constitutional Court would find the government’s actions unconstitutional and reinstate the old board.

    Ichoho said that all cases brought by or that have been filed by KTDA challenging the Crops Industry Regulations, 2020, and the Tea Act, 2021 will be discontinued with immediate effect.

    “The Company will support full implementation of the Tea Act 2020 and will no longer pursue avenues that are against the interest of over 600,000 small holder farmers,” according to the Kenya News Agency report.

    On June 18, 2021 KTDA elected the following: David Muni Ichoho as chairperson with board members, Michael Kamau Ngatia, Paul Mwangi Kagema, Enos Njiru Njeru, John Mithamo Wasusana, Geoffrey Chege Kirundi, Abungana Khasiani, Erick Kipeyegon Chepkwony, Thaddeus Mose Mangenya, James Ombasa Omweno, Wesley Cheruiyot Koech and Baptista Muriki Kanyaru.

    Patrick Ngunjiri was appointed Acting Company Secretary.

    Celestial Seasonings
    Celestial Seasonings offers 105 varieties of tea.

    Hain Celestial Simplifies Tea Selections

    US grocery stores enjoyed a strong 2020 and in 2021 pandemic stickiness is apparent for e-commerce convenience and at-home meals, according to Coresite Research which reports that as of June US retail store closures are down year-over-year for the first time since the initial lockdowns.

    Half of Americans now say they would feel “very comfortable” shopping in a physical store during the next three months, compared to 29% in the year-ago period according to SafetyCulture. When they return, consumers will discover that higher ingredient costs, packaging, shipping expense and eroding brand loyalty convinced food manufacturers to simplify their offerings.

    General Mills anticipates raising its prices 7% globally over the next year. “We are ending one period of significant consumer disruption only to start another,” Chief Executive Jeff Harmening told the Wall Street Journal. “The next few months will be especially critical for our brands as the world transitions to a new normal.”

    Tea manufacturer Hain Celestial has a big footprint in grocery with thousands of SKU (stock-keeping units) – far too many according to Mark L. Schiller, president and chief executive officer. Schiller told investors that shedding 20 brands, discontinuing 1,000 SKUs proactively before the pandemic and really simplifying the way we operate …” were the cornerstones of a simplification strategy that has increased margins.

    He told Food Business News that he is transitioning the $2 billion Hain Celestial Group from a holding company to an operating company. The new focus is on innovation vs. additional flavor varieties, he said.

    “So, instead of ‘here’s the 37th flavor of Sleepytime tea,’ ” he said, “we’re bringing tea with energy, tea with melatonin, tea with probiotics and gut health and immunity and things that are much more incremental in the category, cold brew tea, K-cups, things that really are going to help the retailer grow their category and therefore, earn their space.”

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  • Tea Biz Podcast | Episode 23

    Tea Biz Podcast Logo

    Hear the Headlines

    | Sri Lanka’s Clean Tea Ambitions
    | COVID’s Toll on Tea Garden Workers
    | Tea Day Auction Yields Record Prices
    | Nayuki’s Lucrative IPO

    Tea Price Report

    The worst of the pandemic’s second wave seems to be behind India as the number of cases have come down in many parts of the country, and lockdown restrictions are slowly being lifted. The focus now turns to production and prices across auction centres. Read more…

    Features

    Tea Biz this week travels to Boulder, Colo. where Maria Uspenski, founder of The Tea Spot explains the relationship of beneficial adaptogens and tea…

    …and then to Milwaukee, Wis., where Jeff Champeau, vice president of business development at Rishi Tea & Botanicals, explains that marketing seasonality is a great way to introduce craft-brewed tea into our lives.

    Maria Uspenski
    Maria Uspenski

    Adaptogens and Tea

    By Marilyn Zink | Herbal Collective Magazine

    Our guest this week is Maria Uspenski, a cancer survivor, and author of Cancer Hates Tea. In 2004 Maria founded The Tea Spot, a tea wholesaler and teaware design company in Boulder, Colo.  Read more…

    Maria Uspenski on Adaptogens and Tea
    Jeff Champeau, vice president of business development at Rishi Tea & Botanicals
    Jeff Champeau, vice president of business development at Rishi Tea & Botanicals

    Healthful Effervescence

    By Dan Bolton

    Tea is on a trajectory akin to small-batch, craft-brewed beer where carefully selected ingredients are individually prepared to showcase their best characteristics. Recipes emphasize balance, with efficacy and taste foremost. Excellence in blending and brewing preserves high concentrations of polyphenols and other beneficial plant compounds with minimum calories, nothing artificial, the convenience of cans – and the fun of fizz. Read more…

    Jeff Champeau on sparkling craft-brewed teas
    Jayampathy Molligoda, Chairman SLTB
    Jayampathy Molligoda, Chairman Sri Lanka Tea Board

    Sri Lanka’s Clean Tea Ambitions

    By Dan Bolton

    The Sri Lankan government’s ban on chemical fertilizers including nitrogen, phosphorus, and potassium urea pellets, in favor of organic fertilizers is generating vigorous debate as the tea industry weighs methods for increasing yield.

    Jayampathy Molligoda, chairman of the Sri Lanka Tea Board, attributes the gradual decline in productivity in Sri Lanka’s tea gardens to continuous application of chemical fertilizer. In a 2,500-word article titled “Sustainable Solution to the Decline in Tea Production, Export Revenue and Livelihood” Molligoda advocates a “radical shift in our perceptions, our thinking, and our values.” He writes that the only viable solutions are those that are sustainable.

    His views are in sync with business leaders in Sri Lanka from many industry sectors, who are advocating a “green normal” in which companies collaborate to protect nature. One such coalition, known as Biodiversity Sri Lanka (BSL), is at the heart of building “truly sustainable economies and livelihoods.”

    Molligoda’s challenge is science as critics point to the myriad difficulties of switching from a compact, precisely applied plant food to a bulky and much more expensive alternate. Organic fertilizers are limited in their capacity to deliver nitrogen (12%) compared to chemical fertilizers (46%) and the price can be 50 times greater per kilo than synthetics that sell for less than $1 per kilo.

    Sri Lanka’s growers can produce enough fertilizer for 100,000 hectares and the nation’s 27 licensed domestic organic fertilizer manufacturers can provide enough fertilizer for 224,000 hectares. The country will have to import sufficient fertilizer essential for 500,000 hectares of paddy land and 600,000 hectares of other crops, including tea, according to a report in Economy Next.

    BSL is chaired by Dilmah Tea CEO Dilhan Fernando who writes that, “beyond the pandemic, we all face a threat that could literally suffocate, starve and extinguish humanity. The measures we must take now to assure our health, food security, and survival must be universal, science-based, innovative, and definite.”

    Biz Insight – The prize for Sri Lanka are teas that not only reflect the island nation’s extraordinary terroir but demonstrate in laboratory tests a level of purity no other tea producing country has achieved. In short, Sri Lanka will grow the cleanest teas in the world.

    COVID's Toll on India's Tea Gardens
    COVID’s Toll on India’s Tea Gardens

    COVID’s Toll on India’s Tea Gardens

    Last year the coronavirus pandemic plunged India’s economy into a recession for the first time in nearly a quarter of a century. Tea production, tea exports, and tea retail all suffered, but rural workers were largely spared the high death counts experienced in the nation’s crowded cities.

    That is no longer the case as the COVID-19 second wave crests. The tea industry employs 3.5 million workers who reside in small homes and who rely on crowded vans for transport, resulting in much higher rates of infection than in 2020. Currently more than half of the 800 tea gardens in Assam and 300 of the registered gardens in West Bengal report active cases. Confirmation in a single tea estate of 20 or more cases results in the designation of containment zones. There are now 3,000 active cases among tea workers in Assam, but deaths of tea workers are rare at 102. Kerala reported 331 deaths of tea workers with 11 in Tamil Nadu. On June 15 West Bengal reported 4,371 active cases and 84 deaths.

    The rate of infection has dropped significantly since May, but vaccine hesitancy remains ‘rampant.’ Fewer than 100,000 tea workers in Assam have received their first shot with only 6,000 getting the required booster so far. Globally only 10% of the world’s population had been vaccinated as of June. Read more…

    Jorhat Tea Auction Centre
    Jorhat Tea Auction Centre

    Tea Day e-Marketplace Auction Yields Record Prices

    Selections of Indian tea harvested on May 21, International Tea Day, sold at record prices this week on a cloud-based digital marketplace launched at the height of the pandemic.

    The auction was conducted by mjunction, India’s largest B2B e-commerce platform.

    A whole leaf tea from Pabhojan Tea Estate sold for INRs 4000 (about $54 per kilo US) with a specialty green from Diroibam earning a winning bid of INRs 1000 (about $13.50 per kilo US). More than 93% of the teas on offer were sold.

    Pabhojan Tea Estate INRs4000 Record Price
    The Pabhojan Tea Estate orthodox above brought INRs 4000 ($54 per kilo)

    Additional tea estates with lots sold includ Lankashi, Aideobari, Muktabari, Rungliting, Narayanpur Panbarry, Durgapur, Tirual, and Kathonibari.

    Since June 2020 the marketplace’s 300 registered users have traded 1.3 million kilos of tea. Read more…

    Nayuki’s Lucrative IPO

    China’s fresh-fruit, bubble, and foam-cheese tea chain Nayuki debuted with a $656 million valuation this week on the Hong Kong stock exchange. Shares of the initial public offering traded at nearly $20 and were 190 times oversubscribed. Husband Zhao Lin and wife Peng Lin opened their first store in Shenzhen in 2014. Each is now a billionaire based on their holdings.

    The company operates 500 locations in China with 300 more planned in 2021 and 350 in 2022. International locations include Japan and the US. The IPO debuted before a planned IPO by cross-town rival Hey Tea, a larger venture with 450 Chinese locations that has also established a foothold in the US.

    Nayuki introduces a new flavored tea weekly
    Nayuki introduces a new flavored tea weekly

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