Several of China’s principal tea-producing regions have been hard hit by poor rainfall or lingering cold snaps, and production is this year is liely to suffer as a result.
Hangzhou, home of Dragon Well (Long Jing) green tea, experienced its coldest spring for 10 years, and up to 30% of the tea gardens in the West Lake area were affected. Pickinig was delayed, and farmers are expecting to see significant loss of production. Some varietals, such as No. 43, are expected to see a 20% drop from normal output, driving the prices up.
A late frost and cold rain damaged tea shoots in parts of Jiangsu province, and early predictions are that up to 50% of the cop may lost, Prices have already increased by 25% and could rise further.
The Tea Board of Kenya is continuing to press Pakistan to review import duty charged on tea as a means of tackling rampant smuggling of tea across the highly porous border between Pakistan and Afghanistan.
"There is very little we can do in terms of regulating what volume goes into Afghanistan because its an open market system and everyone has a right to buy from anyone, but we have resolved to continue lobbying Pakistan to lower the import duty on tea that enters its market," according to Sicily Kariuki, managing director, Tea Board of Kenya (TBK) quoted in Business Daily. "This will deny smugglers the incentive to engage in the malpractice."
Currently, Pakistan charges a total of 37% on imported tea, in the form of a 10% import duty, sales tax of 15% and 10% value-added tax, plus a further 2% income tax. Tea smugglers, who are widely believed to be connected with terrorist groups, are able to sell their product for significantly less, placing legitimate tea importers at a disadvantage.
Torrential rains that lasted into February may help boost Kenya’s tea and coffee production by up to 10%, according to agricultural economist Peter Kegode, quoted by Bloomberg.
"There has been above-average rain in tea- and coffee-growing areas," Kegode confirmed. "There should be 10% increase in tea production."
The Kenya Tea Development Agency (KTDA), the country largest tea grower, is expecting to see its production increase to 84 million kg of green leaf this year, up from 81 million kg in 2009.
The Matcha House in Barcelona, Spain, and Aoi Seicha in Japan have launched a wholesale program to deliver matcha to European tea makers and other ingredients users.
The Matcha House recently opened in Barcelona with the mission of making matcha more widely available in Europe. Announcing the new program, the company cited matcha’s widespread use as an ingredient in European pastry and beverages, as well as its increasingly well-known health benefits, as reasons for the launch.
According to the announcement, European companies can contact The Matcha House for industrial- through ceremonial-grade matcha. The Matcha House will source the product directly from Aoi Seicha. A private label program is also available.
According to Aditya Khaitan, managing director, of McLeod Russel India Ltd., quoted in an interview with Reuters, a global tea shortage will not ease in 2010 and will continue in 2011 as demand continues to outstrip supply, even though production has been ramped up in Kenya, Sri Lanka and India. Poor rainfall affected tea crops and boosted prices in 2009 to record highs.
"The deficit [estimated at 100 million kg in 2009] may reach as much as 130 million kg by April, compared with the 110 million kg forecast in September, and prices may rise to a record again this year as shortages persist," Khaitan, told Reuters.
The Tea Board of India has released figures indicating that from January to October India’s output in 2009 dropped to 830.4 million kg from 2008’s 832.5 million kg, while exports fell 12% to 150 million kg during the same period.
Top-quality Assam tea saw its price increase by about 50% in 2009 over 2008, to Rs130/kg (US$2.81). Analysts believe the price could edge even higher in 2010.
When the most influential players in Asia’s food and hospitality industry converge in Singapore from 20 – 23 April 2010 at FHA (Food&HotelAsia), they will likely be overwhelmed by the sheer enormity of the exhibition. Expected to feature 2,800 exhibitors from 70 countries, the exhibition is also recognized for the vastness of its offerings, bringing the latest products and solutions from across the globe to the markets in the region.
FHA2010 will also feature the Asia Barista Championship,
2010 started well for the UTZ certified tea program with the first conference in China on sustainable tea.
The conference, a joint organization of the China Tea Marketing Association together with Solidaridad and UTZ certified was very successful and is regarded as the kickoff event to raise awareness and open the doors to the UTZ certification and traceability program in China.
The world’s largest producer of tea, Kolkata-based McLeod Russel, has paid US$30 million for James Finlay Uganda (JF). The deal will see McLeod Russel taking control of Rwenzori Tea, a wholly-owned JF company, and its six tea estates. JF produces 15 million kg of tea worth about US$30 million annually.
The move is in line with McLeod Russel’s announcement that it was seeking to expand its production beyond India’s borders to account for up to 30% of its total production over the next five years.