China’s Vice President Shares a Cup of Tea in Iowa

MUSCATINE, Iowa

China’s vice president and heir apparent fittingly chose to share a cup of tea with residents of this small Iowa community who long ago befriended him as a 31-year-old member of an agricultural delegation from China.

Xi Jinping traveled from a White House visit with President Barak Obama to this city of 23,000 on the banks of the Mississippi River Wednesday to share a cup of tea with 17 residents who shared their guest rooms and meals in 1985.

Eleanor and Thomas Dvorchak recalled putting Xi in their sons’ childhood room, complete with Star Wars action figures and toys. She recalled Xi spent long days touring local farms and processing facilities and on his return enjoyed the family dog and dined with the Dvorchak’s 15-year-old daughter in the family’s four-bedroom, three-bath ranch home.

Ms. Dvorchak, 72, told the New York Times “He did not complain. Everything, no matter what, was very acceptable to him — he was humble.”

Xi Jinping addressed more pressing matters of diplomacy than tea, but his enthusiasm for America bodes well for trade relations. Two-way trade reached $446 billion last year and is expected to reach $500 billion in 2012.

Tea is one of the most important exports and the Chinese are specifically targeting North America. The China Tea Marketing Association estimates black tea accounted for 66 percent of the 4.06 million tons of tea produced in 2010.

China's tea export volume in 2010 exceeded 300,000 tons and its export value hit the record high of $784 million, according to MarketResearch.com. This is a small sum when compared to China’s $4.76 billion domestic market for tea but exports of high-value black tea, at 1.3 million tons represent 75 percent of China’s global tea exports, according to the China Tea Marketing Association. Nonetheless, in the world export market Chinese black tea amounts to only 5 percent and is greatly overshadowed by top producers Sri Lanka, Kenya and India.

Trade in tea is reciprocal with western brands like Lipton finding shelf space and favor among middle class Chinese and young people. Green tea Sprite is a best seller and bottled ready-to-drink teas are in demand.

Long the world’s greatest producer at 1.4 million tons, Chinese citizens consume 1.1 million tons locally. Only recently have they embraced branded offshore offerings. Trade in instant tea for example has risen by more than 15 fold in the past five years in both volume and value to become the biggest packaged category. It is very popular with affluent young people. Fruit and herbal teas are also gaining popularity. Unilever China is the largest outside producer among the top 10 tea brands. Local companies Guangdong Strong and Zhejiang Xiangpiaopiao hold the greatest market share, according to Euromonitor.

The green segment in China accounts for 71.4% of the market which has grown at a compound annual growth rate of 7.4% for the five years ending 2009, according to Research and Markets. Chinese tea on average sells for under $2.70 per kilogram in the world market according to the China Tea Marketing Association. This is 40 percent less than Indian teas and 60 percent less than Ceylon tea from Sri Lanka, a country which annually earns $1.2 billion on tea exports.

North Americans mainly drink green tea from China but black tea exports are on the rise. Fujian currently produces 40,000 tons of black tea, approximately 44 percent of all the black tea grown in China. Much of this tea is destined for the West. China’s investment in cultivating organic teas combined with the proficiency of growers in Fujian’s Wuyi Mountain are expected to boost annual output to $31.75 million by 2015, according to the blog China Beverage News.

Iowan Sarah Lande served on the committee that organized Mr. Xi’s trip to Iowa in 1985.
At Wednesday’s tea, she told reporters “I’m hoping that our friendship from the past will be an example of how we build an even stronger relationship.”

Tea professionals on both sides of the Pacific share that hope.

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Dan Bolton

About Dan Bolton

Dan Bolton edits STiR Tea & Coffee Industry International. He was formerly editor and publisher of World Tea News and former editor and publisher of Tea Magazine and former editor-in-chief of Specialty Coffee Retailer. He is a beverage retail consultant and frequent speaker at industry seminars and conferences. His work has appeared in many beverage publications. He was a newspaper reporter and editor for 20 years prior to his career in magazines. Dan is the founding editor of Natural Food magazine and has led six publishing ventures since 1995. He lives in Winnipeg, Canada.

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