India's tea export prospect to G20 nations bright, say stakeholders

Tea garden workers pluck tea leaves in Northeast India`s Assam. Pic/iStock

Indian tea industry's export prospect is bright, as a whole and to G20 nations in particular, amid the uncertainties arising out of the non-placement of fresh contracts from Iran, and doubts over the quality and quantity of the crisis-hit Sri Lankan crop, stakeholders said on Monday.

India exported 134.14 million kg of tea in the April-October period of the ongoing 2022-23 fiscal, with a major chunk of the shipments going to traditional buyers among the G20 bloc, according to official data. Over 112 million kg of tea was shipped out during the first seven months of the previous financial year, it showed.

"Prospect of tea exports, as a whole, and to G20 countries, in particular, is bright. Shipments to our traditional importers in the 20-nation bloc have picked up, according to year-on-year comparison," Tea Board India chairman Saurav Pahari told PTI.

"We have already achieved 63 per cent of the export target of 225 million kg this fiscal. Price realisation of exported volume is also satisfactory," he added.

If the international factors, such as geo-political tension arising out of the Russia-Ukraine war, the inadequacy of containers and high freight charges, become better, tea export will pick up further, he said.

Industry veteran PK Bezbaruah, who is a former chairman of Tea Board, said that provided the global economic situation becomes normal, the outlook for Indian tea is very good.

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"Even in a difficult year like the 2022-23 fiscal, shipments should go up by 25-30 million kg as compared to the previous financial year," he said. While some of the G20 nations, such as Russia, import lots of Indian tea, China and the US are expected to buy more from India, he said.

"Even though the dependence of the tea sector on the G20 bloc is relatively lower as compared to India's overall export basket, still these countries are important for us. Maybe, 80-100 million kg of Indian tea would go to these countries this fiscal," Bezbaruah said.

Pahari said India's G20 presidency is a unique opportunity to showcase the country's strengths to the entire world, and the board is leaving no stone unturned to promote the beverage.

"We will set up experience zones in G20 ministerial meetings that will be held this year, where we are hoping for good footfall," he said.

Tea Board India has been entrusted with the responsibility of curating the Indian tea tasting and experience zones at Mumbai, Kevadia, Bengaluru and Jaipur. After the pandemic, tea is considered a beverage with health benefits, and India needs to focus on that, he said.

Indian Tea Exporters' Association chairman Anshuman Kanoria hailed the Centre for leveraging India's G20 presidency to promote the commodity among the bloc.
"We welcome attention being given to tea during the G20 meetings and highlight the history of the commodity in India. We are hoping that this will be an initial step by the Centre to help the industry promote the beverage more aggressively within the group of 20 countries," he said.

India's G20 presidency is coinciding with the FAO Intergovernmental Group (IGG) meeting on tea, which will be held in Guwahati in April. Rating agency ICRA's vice president Kaushik Das said the quality and quantity of tea from crisis-hit Sri Lanka, a major producer of orthodox variety, is "in question".

"With the economic crisis in the island country, Indian tea producers have benefitted in the 2022 calendar year and going forward, they need to work on maintaining such benefits on a sustainable basis," he said.

Sri Lanka produces around 300 million kg of tea annually and exports around 97-98 per cent of it. India produces around 110 million kg of orthodox tea, and of that 90 per cent is exported, he said.

On non-placement of orders from Iran, a major importer of Indian tea, Das said this is unlikely to have any material impact as fresh contracts from the west Asian country are not done during this time of the year and these usually happen during the second or third quarter.

Indian tea was able to increase its share in a few countries such as Turkey and Saudi Arabia, which were traditionally buyers of Sri Lankan tea, Kanoria said.

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