In the last part of our tea trade 101 series, we showed you in a thought game what the journey of a tea from the production country to us looks like. Today, on the other hand, we want to show you some figures around the tea trade to understand what the tea market looks like right now.


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The most elementary component of the tea trade is production. Without the hard-working people in the tea gardens, the trade in tea would not be possible. Especially important are the tea masters, who create new varieties and are masters of what qualities can be found on the market. In recent years, there has been a clear change. Demand for ecologically and sustainably products has risen sharply, especially in the West. This demand is being met by more and more organic certified producers around the world.

If a tea farm in Japan has an EU organic seal, it does so in order to find a new sales channel in Europe. The prices to be achieved here are much higher than at home, and demand is also rising sharply. In the course of globalization, tea has thus become an internationally traded commodity through and through, whether it is high-priced or low-priced tea.

Growing area for tea

Since 1961, the area under tea has more than tripled. China accounts for almost half of the total area under cultivation. The strong growth of the area can probably be explained by the strong growth in production volume, especially in China, India and Africa.


China’s dominance over the tea market

Even when it comes to the tea trade, the Middle Kingdom is far ahead. On the one hand, the country has to meet its own consumption of tea with just under 1.4 billion inhabitants. On the other hand, the country is heavily re-emphasised on exports. This requires a huge amount of land. Early on, the Chinese realized that the tea trade can be extremely profitable. Whether in the UK, the Middle East or other Asian countries, buyers for the traditional Chinese product can be quickly found everywhere. In the course of technology and digitalization, however, more and more tea farms are relying on high-tech instead of tradition. The quantity should be increased as continuously as possible, and this with a consistently high and constant quality.

But even giant China could not meet the global demand for tea alone. India, Sri Lanka and, more recently, Kenya, in particular produce large quantities of tea. The trend is increasing. In the low-price segment, the African continent in particular mixes up the tea market. Unlike many Asian countries, Africa still has a massive lyant of cheap labor in the countryside, which ensures that nations like Kenya can offer combat prices that even China or India cannot compete with. There is a great danger here that human beings and nature will suffer long-term damage because aspects of sustainability are disregarded. More in it, however, at the end of this article.

Let’s take a look at the distribution of the growing areas:

Tea trade tea growing tea tea tea
distribution of the area under tea by nation; Source: Food and Agriculture Organization of the United Nations


Worldwide market volume of tea

The market volume of tea is constantly growing. In 2019, the market volume for tea was 41.6 billion US dollars, in 2020 it is expected to grow to 43 billion US dollars. Global consumption is also growing steadily every year. It is interesting to note, however, that per capita consumption is relatively constant. In 2014, an average of 0.88 kg of tea was consumed per person. In 2017, it was 0.91 kg. How can global growth be explained? On the one hand, steady population growth would be a possible explanation for rising consumption. The economic upswing of many East Asian nations, especially China, would also explain the increased consumption of tea trade.

What about the higher market volume? More demand, of course, also means more action. A change in supply and demand also has an impact on price. Let’s see how the price has developed in recent years.

Average tea price

In the first half of the new millennium, the price of tea has risen steadily. Since 2017, however, there has been a clear downward trend. Because:

    • In 2019, the average price for a kilo of tea was USD 2.57
    • In 2017, a kilo of tea costs an average of 3.15 USD
Tea trade tea buy tea prices Price Tea Tea
change in the average tea price per kg in USD; Source: World Bank

There may be several reasons for this. On the one hand, the amount of tea produced increases. Of course, demand is also high, but it is possible that the increase in supply will outperform the increase in demand. Due to the inflated supply, the price is depressed and falls as a result. Another reason could be the high competition for tea production on the world market. The growing regions of China, India, Sri Lanka and Kenya in particular are engaged in an intense price war. The amount of cheap tea is huge, it will constantly try to be even cheaper than the competition.

It remains to be seen how the market will develop in the future. However, it can be assumed that global trade prices will fall even further.

Tea plants tea trade tea buy
Fresh, young tea plants

The tea market in Germany

In Germany, too, the tea market has changed in recent years. After the peak of consumption of black tea and green tea in 2013, consumption has declined slightly in recent years. In 2017, per capita consumption was about 25.6 litres of black or green tea per capita per year, just under one litre less than in 2013. The Germans are much more diligent in the case of herbal and fruit tea. In 2017, every German drank an average of 52.1 litres of herbal and/or fruit tea per year.

Import of tea to Germany

The sheer amount of tea imported annually in Germany has also decreased slightly. After the export volume has risen from 46,572.6 tonnes in 2009 to 58,567.9 tonnes in 2014, the import volume in 2019 will again be 49,643.2 tonnes. It may well be that tea has experienced a strong trend in these years, which has now faded away. It can also be observed that, according to the Federal Statistical Office, the export volume of tea from Germany has decreased by several tons. It is therefore quite possible that the interlude for tea in Germany will decrease.

On the other hand, there has been a sharp increase in import prices for tea. Both the average price per tonne and the total value of imports have grown strongly in recent years. By contrast, the price level on the world market has rather fallen. The fact that the Germans spend more on tea may be due to the fact that more attention is paid to quality and guidelines for purity have been tightened. The increase in demand for organic and fair trade products, which cost more, could also explain the price increase.


A look at the numbers: how we see the future of the tea world

Trade and the world are constantly changing. So is the tea trade. We forecast a growing demand for high-quality and sustainably grown teas, especially in Germany and Europe.

Climate change will certainly be an immense challenge for countries like Africa. Suppliers in South Africa already have drought problems. Producers in regions such as China, India and Japan have been relatively spared from this. However, it is quite possible that the climate will make it more difficult for producers there to keep quality and harvest ingesrate constant.

The fierce price war offered by countries such as Kenya, Sri Lanka, India and China does not make the pursuit of sustainability any easier. The fact that the price level of traded teas in Germany is rising and thus defying the global trend is pleasing, especially when one sees that trade in organic and fair trade products is increasing. There is definitely a lasting change in purchasing behaviour among German consumers.

Teefram Taiwan Tee Tea
Sustainable tea farm in Taiwan

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This post is also available in: Deutsch (German)