Mid-year statistics show tea production in 2014 will fall short of recent years.
Kenya, the world’s largest producer of black tea reported a second year decline due to reduced rainfall during the critical spring months and cooler summer temperatures for the second flush harvest. Production was down .44 mkg to 225.18 mkg.
Sri Lanka produced 172.17 mkg during the first half of the year which is .08 mkg less than 2013, according to reports compiled by tea boards in these countries and published in the Hindu Business Line.
“Of the 19.78 mkg shortage, as much as 17.83 mkg has happened in India. Here again, North India accounted for the bulk of shortage. North Indian production declined by 22.27 mkg, while South India’s output rose by 4.44 mkg. Collectively, India produced 380.93 mkg against last year’s 398.76 mkg,” Rajesh Gupta of Global Tea Digest said.
In Kenya Kericho county was most affected with production declining by 13.1% to 36.12 million kilos from 41.55 mkg in 2013, according to All Africa.
The West of Rift region’s production slid 4.7% in the six months to 131.97 mkg from 138.48 mkg, reversing gains in East of the Rift which produced 7% more at 93.22 mkg compared to 87.14 mkg a year ago.
Kenya’s Tea Board said local consumption is expected to grow as demand for factory-packed teas grows. Volumes consumed locally rose by 38.5% to 16.9 mkg in the six months from 12.2mkg.
China is the world’s largest tea producing country but exports relatively little black tea. In recent years production for export has increased.
Declines are exacerbated by the fact that demand continues to rise due to increased consumption per capita and population gains. Increasing numbers entering the middle class in countries including Brazil, Russia, India and China also lead to greater tea purchases.
In many instances however increased sales are from canned and bottled tea which require consume far smaller volumes of tea.
In China for example, bottled tea has increased its share of China’s beverage market over the past decade – from 7% of the total domestic beverage volume in 2000 to 26% in 2013. During the past five years, industry revenue increased annually at a rate of 15.6% to an projected $18.2 billion in 2014, according to IBIS World’s Tea Production in China Report (June 2014). The market research company reports that that are 243 enterprises operating in the industry employing 65,284 workers.
“The strong performance of the industry has been the result of increased consumer health consciousness and the rapid development of herbal tea beverages. This industry is focused on the large domestic market; exports contribute only 1.3% to total industry revenue. In addition, very little tea is imported into China. Imports account for just 0.9% of domestic demand,” according to IBIS World.
Source: IBIS World