Tea Association of India warns of return to ‘dark phase’ for industry

A race to the bottom for cheaper teas is impacting the health of the beverage industry, the Tea Association of India said

January 10, 2024 10:15 pm | Updated 10:15 pm IST - Guwahati


India’s tea industry is experiencing challenges reminiscent of the “dark phase” of 2002-07, calling for introspection and resilience, an association of tea growers and manufacturers has said.

Stagnant prices, oversupply, widening gap between demand and supply, and a “race to the bottom” for cheaper teas have been identified as major factors.

“The economic strides made by our nation are indeed commendable, yet the tea industry is currently experiencing challenges reminiscent of the dark phase two decades ago,” Ajay Jalan, the president of the Tea Association of India (TAI) said at the association’s meeting in Kolkata on Wednesday.

The tea industry suffered a drastic market slump during 2002-07 owing to certain regulations, falling demand, entry of cheaper teas from other countries into the Indian market, and dip in exports over quality concerns.

“Tea prices have remained stagnant over the years except in 2020 when buoyancy in prices was noted due to the pandemic. Unable to keep pace with increasing input costs, many estates have shut, changed hands, or are surviving through subsidies from their group companies,” Mr. Jalan said.

“The situation is so dire that we fear a lack of future interest in the industry,” he warned.

Demand-supply gap

A major worry underlined at the meeting was oversupply leading to a significant imbalance between availability and consumption; concentration of market power among a few key players, and a decline in the quality of teas to make the beverage more affordable.

“The race to the bottom is coming at a cost. It is imperative that we reposition tea to enhance its perception and consumption patterns,” Mr. Jalan said, suggesting a slew of measures for the Tea Board of India to consider.

Steps include regulatig tea waste sold in the domestic market at lower prices, restricting import of poor-quality teas, and promotion of tea emphasising its health benefits. TAI said regulating waste can lower supply by 15-20 million kg, and restricting import can further remove 30 million kg of low-quality teas.

Assam grows about 55% of the teas produced in India. India’s tea production has increased by 39% from 981 million kg in 2008 to 1,336 million kg in 2022.

It is projected that tea production in 2023 will be around 1,365 million kg, almost the same as in 2022.

India’s export till October 2023 was 182.69 million kg of tea, 2% less compared to that in 2022. Tea imports, on the other hand, increased from 27 million kg in 2021 to 30 million kg in 2022.

0 / 0
Sign in to unlock member-only benefits!
  • Access 10 free stories every month
  • Save stories to read later
  • Access to comment on every story
  • Sign-up/manage your newsletter subscriptions with a single click
  • Get notified by email for early access to discounts & offers on our products
Sign in


Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.

We have migrated to a new commenting platform. If you are already a registered user of The Hindu and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.