Tea News for the week ending October 28

Podcast Episode 90

To qualify for an IMF bailout bankrupt government must collect more revenue

The proposed increase to a maximum of 30% from 24% of earnings is needed to qualify for a $2.9 billion bailout by the International Monetary Fund (IMF). The only sector earning significant foreign exchange revenue is Sri Lanka’s tea industry. Production is down by 20%, but growers are getting record prices at auction. The tea sector generated $819 million during the first eight months and is on track to earn around $1.2 billion, comparable to the $1.3 billion in 2021 exports. In an open letter published Oct. 17,  the Tea Export Association “earnestly requests the government to maintain the concessionary corporate income tax rate of 14% for the tea sector for its long-term sustainability, which will ultimately bring in much higher growth dividends for the economy.”

| Vietnamese Tea Exports Experience Slow Decline

Vietnamese tea exports declined sharply during COVID and have yet to recover. According to the Ministry of Agriculture and Rural Development, tea exports are down 6.4% by volume to 54,000 metric tons through June 2022. Revenue from tea exports was $94 million, which is 1.3% lower than during the same period last year. The Ministry of Industry and Trade estimated annual revenue from tea exports averaged $173.2 million during the years 2016-2020. At that time, Vietnam accounted for 2.4% of the global value of tea exports.

| Kenya to Expand its Orthodox Tea Capability

Kenya’s new administration is investing millions in its tea sector to generate jobs and boost foreign exchange. Two weeks ago, President William Ruto announced that the government would construct a modern tea processing and packaging facility in Mombasa. Simultaneously the Kenya Tea Development Agency (KTDA) asked the government for Ksh800 million ($6 million) to expand production lines at 10 of its 12 orthodox tea factories. KTDA currently produces five million kilos of high-value specialty tea.

| PLUS Joydeep Phukan, the Principal Officer and Secretary of India’s Tea Research Association, discusses a standards update to better align good practices with the United Nation’s Sustainable Development Goals. Growers worldwide adhere to the Tocklai Tea Research Institute’s Good Agricultural Practices (GAP) and Good Manufacturing Practices (GMP) standards. Introduced in September, the new standards will be fully implemented in January 2023.

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Tea News for the week ending October 21

Podcast Episode 89

Contest entries increased by 21% to more than 300, including several from less well-known tea growing origins

Competitors earned 25 Gourmet Gold, 36 Silver, and 34 Bronze medals last week in the 5th Teas of the World International Contest in Paris. The competition awarded 95 medals in two broad categories: Monovarietal Teas and Infusions, Blends, and Scented Teas. Taiwan dominated the Camellia Sinensis categories, earning eight of 17 gold medals collectively. Chinese growers earned four gold medals, followed by Vietnam with two.

Click to view Monovarietal Winners | Infusions and Blends Winners

| India Lifts Tea Blending Ban

Tea tensions between Nepal and India eased somewhat this week as India lifted a ban on blending Nepali tea imports with domestically grown Darjeeling.

| Low Green Leaf Prices Distress Assam Smallholders

Growers on small tea farms in Assam must now pay wages equal to those at the largest commercial gardens. In August the Assam government announced a 27 rupee increase in the minimum daily wage to 232 rupees. Workers, mainly women, who pluck 24 kilos of tea (about 50 pounds a day) will now earn about 9.5 rupees for every kilo plucked. Read this in-depth report by Assam correspondent Roopak Goswami.

| PLUS Nishchal Banskota, the founder of the Nepal Tea Collective, shares his vision of a public benefit corporation that shifts the focus to creating value for every stakeholder in tea – not just shareholders.

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