Tea exports smell the sweetest in 36 years


 Increase in exports and production created a perfect brew for tea exporters in FY2018.

Bangalore, April 9, 2018: India’s tea exports have been the highest in 36 years at 240.7 million kilograms during the fiscal year 2017-18, as data from Tea Board India shows.

The data shows that the exports increased by 18.23 million kgs (8.20%) during 2017 vis-à-vis 2016. The total value of the exports during 2017 stood at Rs. 4731.66 crores, increasing by Rs. 263.55 crores (5.90%).

India is the second largest tea producer and ranks fourth in terms of tea exports in the world.

The latest surge in exports has been attributed to higher production and growing overseas demand.

Ankit Lochan, owner of Surajmukhi Tea Pvt. Ltd, manufacturer and exporter, Bangalore, said, “It’s been a fantastic year. More production took place due to more plantations. Exports rose because Indian tea has economic value and is reasonably priced.”

Mohammad Ashrat, Aamiri tea agency, exporter, Bangalore, said, “India charges less and quality is better. Our tea gets exported to Pakistan and Sri Lanka. Exports were huge in winters this year. They might slump as summer approaches but 2017 was a very good year.”

Production was boosted also due to weather conditions suited for tea growing.

Deepak M. Nayak, Aishwarya Tea Industry, exporter and manufacturer, Bangalore, stated favorable weather conditions in 2017 led to increased tea growth which led to greater exports.

Paulrasu, Executive Director, Tea Board, explained, “Out of the total exports, about 70-80 per cent is from the Nilgris. The rise in exports can be attributed to more production. Proximity to the coast may also be a reason. Trade routes are easily accessible from south. It’s harder for tea that is produced in the interior regions of Assam to be exported. Also, Tea Board has been going to various countries and promoting Indian tea to popularize our Indian growers.”

He added “Apart from regular markets like US and UK, we have also been trying to reach new markets like Chile, Egypt and Iran. Even though China is the world’s largest producer of tea, many Chinese want to drink black tea. Chinese only produce green tea. More black tea is being exported to China from India.”

A report, however, said the higher export earnings notwithstanding, the realisation per kg of tea, remained stagnant at Rs.193 compared to the previous fiscal year. In 2015-2016, Tea exports from India stood at Rs. 232.92 kg, valued at US$ 686.67 million.

Shobitha Suresh, an economist at TAC Economics, explained, “Due to strong geographical advantages, heavy investments in tea plantations and processing units, variety of product mix and key market expansion, tea industry has contributed to India’s economy by fetching foreign reserve through exports.”

Figures for December 2013 show that India has around 563.98 thousand hectares of area under tea production. Assam (304.40 thousand hectares) takes the lead in tea production followed by West Bengal (140.44 thousand hectares), Tamil Nadu (69.62 thousand hectares) and Kerala (35.01 thousand hectares).

Estimates show that the tea industry is India’s second largest employer. It employs over 3.5 million people across some 1,686 estates and 157,504 small holdings, most of them women.