India must work on developing new tea markets

It may take some time more for tea exports from India to reach the pre-pandemic level, but the good thing is that things have started looking up. And going by the Tea Board of India figures, India's tea exports grew 16 per cent in the first nine months of the calendar year, showing signs of a return to normalcy. If things move the way it is moving now, government officials and exporters have reasons to be optimistic. They hope to end 2022 with higher volumes than in the past two years. This is notwithstanding the fact that India tea exporters to Iran, one of the largest markets, are facing uncertainties as the buyers from the West Asian country have stopped signing fresh contracts.

The good news from the Indian tea exporters' point of view has been that the CIS countries imported 38.06 million kilograms during that period in 2022, up from 33.34 million kilograms in the corresponding period of 2021. Tea industry sources say that the exporters are looking for other avenues as shipments to Iraq, an erstwhile major importer, reduced to zero due to payment issues.

Mind you that in 2019, the last year of normal operations before the pandemic, India had exported 165.58 million kg between January-September compared with 142.55 million kg recorded in the same period of 2021. In 2019, the last full year of operations before the pandemic, India had exported 252.15 million kg while in 2018, it was little higher at 256.06 million kg. In 2020 and 2021, India's exports stood at 209.72 million kg and 195.5 million kg, respectively. By the end of the current fiscal, tea exports from India is expected to touch 225 million kg. Experts are of the view that it would take at least two more years to get back to the volume seen before the pandemic. India could have done more, had the payment issue with Iran and Russia not been there.

Over and above the payment issues, high sea freight rates and lack of containers have also been working as deterrents. There is no dearth of willing buyers or willing sellers, but because of the external factors beyond control, India could not do more.

However, now the sea freight rates to major European ports, Russia and the US have been falling and the availability of containers are rising too, much to the pleasure and comfort of the Indian tea exporters. Also, the economic turmoil at Sri Lanka impacted tea export of orthodox variety from the island nation, allowing countries like India to corner a bigger pie of the market.

Time has come when India should also focus on CTC tea export along with orthodox varieties. The small tea growers, the major producers of CTC variety today, must be made aware of the phytosanitary standards which are essential for export. Kenya is the major exporter of CTC variety of tea globally. These apart, India must work on developing new markets. CIS, UAE, Iran and the US account for over 60 per cent of Indian tea export. And now India must look for and develop new markets.