There is nothing to cheer for the ‘Champagne’ of teas

Darjeeling tea, often known as the ‘Champagne’ of teas, may no longer be the cuppa that cheers, not at least from the point of view of the traditional tea estate owners, unless the government and other stakeholders rise to the occasion and bail them out of the impending crisis. This is notwithstanding the fact that Darjeeling tea made it to the G20 hamper for the world leaders and Prime Minister Narendra Modi had presented Queen Elizabeth an award-winning variety from the Makaibari estate on the former’s visit to the UK in 2015. From lower production to muted demand, and falling prices to labour absenteeism- there are more challenges than one that have brewed acute problems in the picturesque tea gardens. One should remember that there are approximately 87 tea gardens that produce Darjeeling tea in and around the ‘Queen of Hills’. For the records, around 20 gardens have changed hands in the last three years and 90 per cent of the buyers come with a non-tea background.

That’s not all. At least 60 per cent of Darjeeling tea estates are up for sale as traditional garden owners are desperate to cut down their losses because it has become an unviable financial proposition. At a rough estimate, the number of tea gardens owned by these estate owners varies between one and 15. The likes of Jayashree Tea and Goodricke have been following this path in the face of various uncertainties. Costs are not only high but they are also rising steadily, the yields are low and the vagaries of nature are wreaking havoc with production. All these reflect the gravity of the problem. Industry officials point out that nearly 50 per cent of Darjeeling tea is exported and key export destinations like the European Union have taken a knock. As for the domestic market, the producers have little to nil bargaining power.

It is pertinent to mention that the average price for Darjeeling leaf at the Kolkata auction from January to September was Rs 353.82 per kg, compared to Rs 351.12 per kg in 2022. There are instances when prices have been significantly lower than last year while wages, which account for 60 per cent of production costs, are on the rise. The first and second flush teas, which are considered to be the prized produces of Darjeeling tea and account for majority of its revenues, have been sold at lower prices, adding to the worries of the garden owners. The problem of Darjeeling tea lies mostly in the cost of production. The cost of production in case of Darjeeling tea is particularly high, touching up to Rs 800 to Rs 900 per kg for the gardens on a higher elevation. This means that the more one produces, the higher would be the losses. The irony is that while the discerning consumers may still be sipping Darjeeling tea, Indians are not having it to their heart’s content like in the good old days. And that is the underlying truth.