Tea Market Analysis in India

Topics: Tea, Black tea, Tetley Pages: 10 (2883 words) Published: December 2, 2010
Tea is one of the most refreshing and popular beverages of the world. India is one the the largest Tea producer in the world. Indian tea is the finest quality in the world. After water tea is the most widely consumed beverage in the world. Tea is basically the dried and processed leaves of only one species of plant called camellia sinensis.

Herbal teas or herbal infusions are not really teas, but simply dried leaves and/or flowers from various other plants and herbs. Tea manufactured from green leaves is divided into two types Black Tea and Green Tea. Green tea and black tea have different manufacturing processes. Black tea is again of two types Orthodox tea and CTC tea.

Orthodox teaCTC tea
Orthodox teas are manufactured with the help of orthodox roller in the process of rolling. CTC machine or Rotervan is used in rolling process in manufacturing CTC teas.

Origins of tea can be traced back to 4th century A.D in China. In 350 A.D Kuo P’o’ described tea as a beverage made from boiled leaves. From 350 to 600 A.D the demand for tea dramatically increased and outstripped the supply of wild tea trees. Thus farmers began to grow tea plants commercially in China. Tea was introduced to Western world in 16th century. India

In 1780, tea cultivation was experimented in India with seeds from China by Robert Kyd. Wild tea plants were discovered to be growing in Upper Brahmaputra Valley. Three major tea producing areas in India :

1. Darjeeling – North eastern India
2. Assam – Far North east India
3. Nilgiri – South India
All three are different in style and flavour.
Darjeeling found at the foothills of Himalayas gives the finest and most uniquely flavoured teas. Called “Champagne of Teas” Assam offers bright and strong cup of tea. It is the single largest contiguous tea growing area in the world. Niligiri tea has elegant flavor and briskness. Combination of fragrance and briskness makes it a truly unique tea in world. Tea producing areas in India : Tea production in India

India is the second largest producer of Tea in the world.

Source: Supplement to Annual Bulletin of Statistics-2008, ITC London As far as exports are concerned, India is the fourth largest exporter in the world.

Source: "Supplement to ITC Annual Bulletin 2008"
India has dual manufacturing base. India produces both CTC and Orthodox teas in addition to green tea. The weightage lies with the former due to domestic consumers’ preference. Orthodox tea production is balanced basically with the export demand. Production of green tea in India is small. The competitors to India in tea export are Sri Lanka, Kenya, China, Indonesia and Vietnam.

Tea is an essential item of domestic consumption and is the major beverage in India. Tea is also considered as the cheapest beverage amongst the beverages available in India.

Tea Industry provides gainful direct employment to more than a million workers mainly drawn from the backward and socially weaker section of the society.

It is also a substantial foreign exchange earner and provides sizeable amount of revenue to the State and Central Exchequer.

The total turnover of the Indian tea industry is in the vicinity of Rs.9000 Crs.

Presently, Indian tea industry is having (as on 18.12.2009 ) * 1692 registered Tea Manufacturers
* 2200 registered Tea Exporters
* 5848 number of registered tea buyers
* Nine tea Auction centers

India predominantly products CTC tea, because of high domestic demand for same. The consumption is above 600 Million kgs per year.   The market consists of both Leaf and Dust Teas both in the CTC and Orthodox Grades.

Market Share

Total tea consumption in India is estimated at 650 million kg, of which the share of packaged tea is 290 million kg, which is...
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