2021 continued with COVID-19 as the prevailing headline, and it stayed that way throughout the year. Whether it was masking policies, availability of vaccinations, booster shots, the Delta variant, Omicron variant, proof of vaccination, travel restrictions… well, you get it!
No matter what happened, everything seemed to revolve around COVID. In reality, so much more was happening, albeit influenced by this horrible pandemic. We just need to part the curtain and see what happened backstage.
As Far as Tea Was Concerned, the Pandemic Was a Mixed Blessing
Overall, the tea market grew in 2021. In reviewing tea import figures through September, total tea imports are up over eight percent, with black tea exceeding 2020 by more than nine percent. As reported last year, a qualitative study sponsored by the Tea Association of the U.S.A. reported that consumers turned to tea during those difficult times. This trend continued in 2021 with tea’s perception as being an enabler for de-stressing, as well as providing a feeling of “centeredness” during these anxious times. This complements tea’s perception as a plant-based, healthful drink, consumed for its variety of benefits, rooted in its high flavonoid content. In fact, several new research papers were published in 2020 and 2021, illustrating tea’s extraordinary ability to act as a booster of human immune systems.
Further, consumers seem to truly embrace the entire process of brewing tea in their home. It is known that personal “tea ceremonies” – whether using a family recipe, a “mom’s” kettle or a certain mug – in and of itself calms and relaxes. This coupled with tea’s natural ability to induce a “relaxed but ready” mental state, heightens the feeling of serenity and internal quiet, mental states that were at a premium during this past year.
And as we know, mental health is only part of tea’s attraction. Literally thousands of published scientific journals have documented tea’s ability to positively impact human health. Whether potentially interfering with cancer mechanisms, enhancing heart health, slowing neurological decline, positively impacting weight management, preventing diabetes, improving bone health or lastly boosting immune functionality, tea is good for you and tastes great!
While tea consumption generally benefited positively, COVID-19 impacted businesses, forcing different ways of working in companies and supply chains.
Inventory declines were one of the results of the shipping imbalances caused by our emergence from isolation. Container vessels were stuck offshore while ports struggled to move cargo onto trailers for delivery to customers. Ocean freight companies raised rates to unconscionable levels with some export regions, particularly Asia, seeing the cost of a FEU going from US$3,000 to US$17,000. Further, a container imbalance prevented a faster recovery. The situation was so dire that the Federal Maritime Commission (FMC) and even President Joe Biden got involved in an attempt to get supply chains back to some semblance of normalcy. Our participation in a Freight Coalition consortium assisted us in helping to apply pressure and notice to key players in the government and maritime bureaucracies to act on consumers behalf.
Tariffs on tea from China continued as a holdover from President Donald Trump’s administration and continues under President Biden. We continue to advocate for removal of this tariff on Chinese tea.
Our work in Washington D.C. continued with the Tea Association of the U.S.A. communicating its positions on behalf of the industry in the areas of tariffs, labeling (country of origin and nutritional), dietary guidelines and port congestion issues. Even more exciting is that we will be hosting the 6th International Scientific Symposium on Tea & Human Health in 2022.
Support and defense of the industry is our mission. This support is seen in a variety of areas, addressing such topics as heavy metals; HTIS classifications and modifications; Prop 65 actions; sustainability issues and nano-plastics in tea bags. Sustainability continues to be an important driver for consumers, customers and industry supply chains. In all efforts, we attempt to ensure cohesive messaging across borders by liaising with the Tea & Herbal Association of Canada and the UK Tea & Infusions Association.
Foodservice Improves; Specialty Tea Continues Growth; RTD Growth Slows; Traditional/Grocery Works to Hold on to Previous Gains
2020 proved devastating to the foodservice market, which was hugely impacted by COVID. The accompanying stay-at-home orders, prohibition of indoor dining and social distancing requirements kept people far away from their favorite restaurants, delis and convenience stores. The entire restaurant, hotel and event categories of businesses, along with the airline industry, kept people, not only close to home, but IN their homes. It is estimated that 2020 loss of revenues was somewhere between 50 to 70 percent. Fortunately, this sector began to come back in 2021 as vaccination rates increased, domestic travel resumed and federal and state governments eased restrictions.
Specialty Tea
Specialty tea continues its rise in both pounds and dollars, bolstered by continued growth with in-home delivery and in-home consumption of tea. While Millennials and Gen Z’s led the way, consumers across all demographics continued to consume tea for its variety of origins, types and flavors. Tea generates interest in terroirs, flavors, origins, bush to brand and sustainability – particularly in these high quality, higher priced teas. Artisanal teas remain of high interest and continue to grow at a fast clip. Consumers are becoming more engaged with their teas and want to learn more and more about where their teas come from; how they are harvested and manufactured; how the product supports the livelihoods of those making it; and, how friendly the product is to the environment. Specialty tea buyers, in particular, seek to engage with their products of choice. They want to know that the dollars they spend are going to support the grower, tea workers and the “brand” as a reward for a job well done in manufacturing quality products.
Ready-to-Drink (RTD) Tea
The ready-to-drink (RTD) tea category continued its growth. Estimates are that 2021 exhibited circa three to four percent growth in volume and five to six percent in dollars. Challenges for RTD remain clear: Competition across other categories – e.g., health, refreshment and hydration – will challenge this category’s ability to innovate and compete in order to continue volume and dollar growth. While more expensive than bagged tea on a per-serving basis, consumers continue to reach for RTD teas for their flexibility and convenience, and as a healthier alternative to sugary beverages. We continue to see separation and segmentation between premium, high quality RTDs and the value, CSD replacement segment. Innovation, flavor variety and healthful positioning will continue to be legs of growth.
Traditional Tea
Traditional tea (Grocery/DMM and Drug/Mass Merchandisers) fought hard to maintain the gains from 2020. Tea bag sales grew some 18 percent last year and preserving that expansion was a focus of most companies. Communication to consumers through traditional media and social media was at a much higher level than previous years, which speaks to the improved bottom lines and need for re-investment in brands. As the foodservice sector expanded and out of home consumption increased, pressure on keeping gains was clear. Increased per capita consumption occurred across all other sectors, and traditional purveyors are working hard to keep their progress.
As an industry, we are challenged to continue educating the consumer in the difference between true teas (Camellia sinensis) from herbals and other botanicals, neither of which have the same level of AOX or overall healthful qualities. Our messaging across all forms of tea through our social media initiatives highlight the benefits of “true tea” and should be amplified by all tea companies.
The cultivation of Camellia sinensis continues to expand in the United States, serving both to answer the call of locally grown and farm-to-table trends, as well as providing alternate, sustainable crops for growers. It is still very early days and any thought of a U.S.-based tea supply for mainstream teas is at least several decades away. However, if margins become attractive enough, more resources may be brought to bear and faster YOY volume gains could be seen.
Geographic Designations
Internationally, producer countries of origin are also protecting and advertising their teas through geographic designations and trademarking their unique terroirs. The adoption of wine-like appellation marketing and protection serves to differentiate one region from another as well as communicating to the consumer the benefits of geography, elevation and climate as key ingredients to tea quality.
The 2021, Pollock Communications’ and Today's Dietitian’s "What's Trending in Nutrition" survey, with 1,165 registered dietitian nutritionists (RDNs) responding, provided an in-depth look at how dietitians believe consumers' diets have changed due to COVID-19.
COVID-19 Transformed the Way Consumers Eat and View Food
As a result of the pandemic, 78 percent of RDNs believe that consumer eating habits are shifting away from the traditional three meals a day to more frequent snacking. In addition, with anxiety about health, wellness and the challenging economy looming in consumers’ minds, RDNs predict the top purchase drivers of 2021 will be foods and beverages that:
1. Support immunity
2. Are affordable and value-based
3. Promote comfort and emotional well-being
Tea not only benefited from COVID in 2021, it hits the bullseye of these drivers by being beneficial to our immune system; readily available and of good value; and an enabler in achieving emotional well-being. Tea will continue to be one of the go-to products in 2021.
Further, WebMD continues to list tea as one of its 10 Superfoods offering Super Health Protection as do Dietitians and Nutritionists.
2022 Predictions for the Industry
- Tea Will Continue to Grow across all sectors.
- Whole Leaf Teas / Specialty Tea – Whole leaf teas and naturally flavored teas are not only continuing to increase in popularity among consumers, especially millennials, but across all demographics. Consumers who are looking for the “story” behind their favorite products have a treasure trove of history, terroir and tradition to investigate with tea.
COVID-19 Continues to Spotlight the “Power of Tea”
- Cardiovascular health, immune boosting properties, and improvement of mood are the most popular reasons as to why people drink tea according to a qualitative survey by Seton Hall University. A new study has been commissioned for 2022, but we can continue to see how tea is viewed by the important Millennial and Gen Z demographics.
- Black Tea – It’s beginning to emerge from under the shadow of green tea’s health aura with ownable health properties, such as:
- Cardiovascular health
- Physical health
- Immune system boost
- Satisfy thirst / hunger
- Pick-me-up
- Green Tea – Green tea continues to drive consumer interest. Americans appreciate this beverage for doing something good for their body, specifically:
- Emotional / mental health
- Immune system boost
- Drank when feeling sick sore – throat / stomach ache
- Stress relief
- Black Tea – It’s beginning to emerge from under the shadow of green tea’s health aura with ownable health properties, such as:
- Foodservice will continue modest growth on its return to pre-pandemic levels.
- Consumers will continue to enjoy tea and the new levels of tea consumption will be maintained, helping grocery/DMM sales to resist declines vs. pandemic gains.
- RTD will continue to grow, albeit at lower levels.
- Specialty tea continues its growth in both dollars and volumes as unique offerings from tea growing “appellations” become more widely known.
Optimism Moving Forward
I remain firmly optimistic going forward. Tea has so much to offer to its consumers. Tea’s supply chain is resilient; producers generally want to produce good product and consumers want to receive good value.
As I stated last year, we, the tea community, need to set expectations with consumers, demand fair return for all in the supply chain and continue to shout from the rooftops about the goodness of tea, both for our world and our health.
Peter F. Goggi is president of the Tea Association of the U.S.A, Inc., Tea Council of the USA and Specialty Tea Institute. Goggi began his career at Unilever and spent more than 30 years working with Lipton Tea as part of Royal Estates Tea Co. He was the first American-born tea taster in the history of T.J. Lipton/Unilever and was featured on The History Channel’s Modern Marvels. His career at Unilever included research, planning, manufacturing and procurement, and his final position was director of commodities procurement, sourcing over $1.3 billion of raw materials for all operating companies in the Americas. At the Tea Association, goggi has implemented and updated their strategic plans; has continued to drive the tea and health message of the Tea Council; and helped to guide the tea industry on its path to growth. Goggi also serves as the U.S. representative on FAO’s International Governmental Group for Tea, and he continues to drive communication and understanding of the multiple issues faced by the tea industry – locally, regionally and internationally.
Founded in 1899, the Tea Association of the USA, Inc. was formed to promote and protect the interests of the tea trade in the United States and is the recognized independent authority on Tea. To learn more, visit TeaUSA.org.
Plan to Attend or Participate in the
World Tea Conference + Expo, March 21-23, 2022
To learn about other key trends, issues and hot topics within the global tea community – or to see the latest products and services – plan to attend the World Tea Conference + Expo, March 21-23, 2022, celebrating its 20th anniversary. The event will be co-located with Bar & Restaurant Expo, creating unique opportunities and synergy. Visit WorldTeaExpo.com.
To book your sponsorship or exhibit space at the World Tea Conference + Expo, co-located with Bar & Restaurant Expo, contact:
Veronica Gonnello
Companies A-L
e: [email protected]
p: 1 (212) 895-8244
Fadi Alsayegh
Companies M-Z
e: [email protected]
p: 1 (917) 258-5174
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