Tea prices may fall sharply over the next decade as supply may outstrip demand, the Food and Agricultural Organisation’s Intergovernmental Group on Tea (IGG/Tea) said.
MismatchA mismatch between demand and consumption of tea in 2014 led to a surplus of 180,000 tonnes and tea prices dropped by 5.3 per cent, a decline at 2013 prices, according to the UN body. World tea output stood at 5.13 million in 2014.
“Caution needs to be exercised by stakeholders in the world tea economy” the IGG said adding that greater efforts should be directed at “expanding demand.” Studies made by the IGG indicate that although prices may increase in nominal terms in 2024, in real terms prices may actually decline by an annual average of one per between 2014 and 2024.
The FAO, IGG/Tea, represents a forum for intergovernmental consultation and exchange on trends in production, consumption, trade and prices including global appraisal of market situation and short-term outlook. It met recently at Kenya.
Among the 92 delegates were all the major member countries like China, India, Kenya, Sri Lanka, Canada, Germany, Indonesia, Malawi, Japan, and United Kingdom. Observers from the International Standards Organisation and, International Tea Committee also attended a three-day meet held here.