British Tea Sales Booming in China

Taylor's of Harrogate's Matthew Davies.

Taylor’s of Harrogate’s Head of International Sales Matthew Davies in the tea company’s tasting room in Harrogate, England.

As tea sales in Britain continue to decline, British tea companies are exploring new opportunities overseas for their brands – including selling tea to China. According to a report by analysts Kantar Worldpanel, Britons are drinking 64 million fewer cups of tea than last year and tea sales have dropped nearly 5%, writes the Express. Combine that with already narrow profit margins due to increased production costs and unfavorable exchange rates following Britain’s Brexit vote, and news that China and Hong Kong consumers are developing a taste for British tea is boosting spirits for Britain’s tea blenders and plantations.

“China and Hong Kong in particular are seeing a surge in appetite for British tea blends – some of which are made with leaves from China itself, an example of the twists in trade that the globalization of tastes can create,” according to a report in The Globe and Mail (London).

Upscale tea blends from storied British companies such as Twinings and Taylors of Harrogate occupy increasingly more space on shelves in Chinese supermarkets, restaurant menus, and online shops, according to The Globe and Mail. In the first five months of 2016, British tea exports to Hong Kong nearly tripled in value compared with two years earlier. They doubled to the rest of mainland China, data from the U.K. HM Revenue & Customs show.

Tea houses serving British afternoon tea have sprouted up in the bigger cities in China, mirroring a cultural thirst for British TV shows such as Downton Abbey, Sherlock Holmes, and Game of Thrones.

Afternoon tea at Downton Abbey.

Afternoon tea at Downton Abbey.

Shipments to China and Hong Kong only make up 7% of total British tea exports, but the share is growing quickly. For Taylors of Harrogate, exports to China have more than doubled every year for the past three years, with Earl Grey and English Breakfast tea being its most popular blends with the Chinese.

“China produces nearly one half of the world’s tea, so on the surface you would think that there is a limited opportunity for Taylors of Harrogate,” said Matthew Davies, Head of International Sales at Taylors of Harrogate. “Our approach was to invest time and resources to understand consumer behaviour and we found that there are a number of Chinese consumers with a high level of discretionary income and demand for Taylors of Harrogate brands.”

Jamie Russell picking tea at Scotland's Dalreoch tea plantation.

Jamie Russell picking tea at Scotland’s Dalreoch tea plantation.

Imported premium British tea brands are perceived as being safer and of higher quality, following findings of high levels of pesticides or poisonous earths in some well-known Chinese brands. Many British tea blends are made from leaves imported from Africa and India.

Even the handful of British tea plantations are noticing an upswing in interest from China and the Far East. A wet and mild winter in the U.K. has produced exceptional yields for many of the 12 tea plantations there, and exports to China and Japan have peaked, according to a report in the Daily Mail.

“This year’s [harvest] has been exceptionally good and for the first time, 80% of our first flush, the finest high-quality tea, was exported to the Far East, mainly to China,” said Scottish tea farmer Tam O’Braan, from Dalreoch Plantation in Perthshire in the Scottish Highlands. Last year just under 5% of the first flush was exported to the Far East.

Sources: Express, The Globe and Mail, Daily Mail