With Africa’s growing population and rising income levels, the continent presents a promising opportunity for the introduction of black tea as one of the world’s healthiest beverages. Hemant Bangur, chairman of the Indian Tea Association, emphasized that tea consumption is more than just a physical need but a cultural phenomenon. He suggested that targeting the African youth by promoting tea as an aspirational drink could help boost consumption in the region.
At a meeting of stakeholders representing leading tea producers’ associations from Asia and Africa in Dubai, the focus was on addressing quality, demand-supply equilibrium, and long-term sustainability of the tea sector. The global tea industry is currently facing a mismatch between production and demand, with traditional tea-consuming nations in Europe and Asia experiencing stagnating demand. It was highlighted that consumption has penetrated across all income groups over the last two centuries.
Arthur Sewe, Chairman of the East Africa Tea Trade Association (EATTA), pointed out that the tea sector in East Africa is facing challenges related to declining tea quality and high production volumes. Climate change was identified as one of the contributing factors affecting tea quality globally. Sangwani Hara, Chairman of the Malawi Tea Association (MTA), echoed the sentiment, emphasizing the need to address climate change for sustainable tea productivity.
The meeting discussed the impact of climate change, price stagnation, high costs, oversupply, and challenges in fair price discovery on the global tea sector’s economic viability. The industry is struggling with declining exports and value of produce, threatening the livelihoods of millions. Strategies to improve quality and restore the demand-supply balance were identified as essential to stabilize prices and boost consumer demand.
Global oversupply has led to a mismatch in the demand-supply equilibrium, affecting tea prices across all Black Tea auction centers. Tea production has increased significantly in the past decade, outpacing consumption levels and resulting in oversupply. Efforts to correct this imbalance and stabilize prices through price stabilization mechanisms were deemed crucial for the sector’s sustainability.
The volatility in tea prices and trade has been exacerbated by economic recession and geopolitical challenges in traditional export markets. Conflicts in regions like the Red Sea and the Gulf of Aden have further complicated tea buying and export processes, impacting smallholder tea farmers’ households. Climate resilient adaptation strategies need to be adopted by tea-producing countries to mitigate the negative impacts of climate change and ensure the long-term viability of the tea sector.
