Tea Industry

Topics: Tea, Sri Lanka, India Pages: 7 (2411 words) Published: April 7, 2013

Based on the consumption the total turnover of the tea industry in India is expected to rise to 33,000 crores by 2015 from 19,000 crores oing to increased production over the past to decades.In trading aspect india is an important tea exporter, accounting for around 12-13% of world tea exports. With nearly six lakh hectares under tea cultivation, the domestic tea industry is growing at a compound annual growth rate of about 15 per cent but over the last 20 years, India’s world ranking as an exporter has come down from number one to number four, in the face of stiff competition from Sri Lanka, Kenya, and China and also due to erratic weather conditions such as flooding and insufficient rainfall in the tea production areas. Some of the constraints facing the Indian tea industry which directly affect production, productivity and quality.Some other factors that have adversely affected the export potential of Indian tea include - various tariff and non-tariff measures imposed by some tea importing countries.Several measures have been taken up by tea board of india inorder to improve the tea industry and strategies have been adopted to meet up the challenges in global demand for tea in the coming years.

India is world’s largest consumer, second largest producer and fourth largest exporter of tea after China and accounts for nearly 30 per cent of global output and nearly 25 per cent of tea produced worldwide is consumed in India .Branded market accounts for nearly 55 per cent of the total market and is growing at about 20 per cent while the unbranded market is growing at 10 per cent annually.Majority of the tea producing countries are located in the continent of Asia where China, India, Sri Lanka are the major producers.African tea growing countries are located mostly around the tropical regions where Kenya, Malawi,Rwanda,Tanzania,Uganda are major producers.Apart from these regions, some quantities of tea are also being produced in South America (Argentina, Brazil and others), the Near East (Iran and Turkey)and the CIS (Russia and Georgia).Globally, tea is cultivated in 36, 91,938 ha with an annual production of 4066596 thousand Kg Over the years, both area and production has increased substantially. The global market for hot beverages is forecasted to reach US$69.77 billion in value and 10.57 million tons in volume terms by the year 2015 (GIA, 2011). The tea production in the last decade of 20thCentury saw a sluggish rate of increase in total area under tea. During 1991, tea was cultivated globally in 2563.75 thousand ha which increased to 2661.88 thousand with a compound growth rate of 0.42% during that period. With the advent of 21stcentury the world tea industry saw a steady increase in the overall area under tea. During 2001 the area under tea was 2727.42 thousand ha which increased to 3691.89 thousand ha in 2010 with a compound growth rate of 3.42% during the said period.In terms of area under tea plantation, on an average during the last two decade (1991 – 2010), China lead (45%) the world followed by India (21%), Sri Lanka (7%), Kenya (5%), Vietnam (3%). The total turnover of the tea industry in India is likely to reach Rs 33,000 crore by 2015 from the current level of about Rs 19,500 crore.Its high time that India should concentrate on improving the production and export of the tea.

The trend of world tea production was almost the same trend as in case of area. The production in 1991 was 2631.05 million Kg which remained almost same till 1997. In 1998 world tea production touched a new height of 3026.13 million kg. In 2000, it dropped to 2928.67 m kg with a compound growth rate of 1.20% during the period of 1991 - 2000. Again, from 2001 onwards production of...
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