By Helen Xu Fei

According to the China Tea Marketing Association (CTMA) report, China’s annual tea output reached 1.45 million tons at a total value of RMB90 billion (USD13.96 billion) in 2009. RMB30 billion (USD4.65 billion) or around one third of the total production value was generated by the Intensive Process Tea (IPT) category. IPT is a relatively new product concept as compared to traditional tea products such as loose leaf tea, CTC tea, teabags and flavored tea, etc.

In China, IPT generally refers to RTD tea, instant tea, purified tea components (e.g. tea polyphenols, theanine, theaflavin) and other innovative tea products that bring revolutionary change to the “slow” consumption pattern of tea. Tea extract is an important intermediate for most IPT products, with about 5% of the country’s tea consumed by the tea extraction industry.
Tea extraction generally uses dry teas as source materials, most of which is off-grade or lower grade tea with uneven leaf size and poor sales value in traditional tea markets. Green tea extract can also be made directly from fresh leaves for optimal freshness. When making tea extract from dry tea, tea leaves are soaked in hot water for a strong infusion. Infusion quality and extract yield is balanced by adjusting the water temperature, steeping time and soaking cycle. After that, the strong infusion undergoes the filtration cycle to obtain a clear infusion. Clear infusion is either concentrated to make liquid tea concentrate, or concentrated and then dried to produce soluble tea powder. When fresh leaves are used as source materials, the leaves are washed and broken into fine particles and then soaked in water for a strong infusion, the rest of the process is quite similar to dry tea extraction. The liquid concentrate and soluble powder made by these methods are known as “full extract”, they are the intermediate products for the RTD and instant tea industry, and can also be used by the F&B industry as flavorings or additives to make tea flavored refreshments or freshly blended drinks.

Another crucial tea extract is “partial extract”, which consists of purified functional components derived from clear infusion. The partial extract places more complicated requirements on technical know-how, equipment and extracting procedure. In order to obtain the intended purified components, the clear infusion made from dry tea or fresh leaves is further purified with solvents, chromatography, and membrane filtering or superficial CO2 techniques to obtain desired components with higher content. Tea polyphenols (TP) is the leading variety of partial extract, which can be widely used as dietary supplements, alternative medicine, functional-food additive and natural antioxidant in health, personal care, F&B and cosmetic industry. China became the leading producer of TP products by 2008. Over 70% of China’s partial extract (from tea) is TP, followed by theaflavin (TF), tea polysaccharide and others. Production volume of “partial extract” is marginal as compared with “full extract”.

Volatile compounds
During extracting, concentrating and drying, the aroma of tea will inevitably suffer certain losses as most aroma compounds are volatile. Aroma recovery systems are designed to collect lost aromas when production is in process. The collected aroma will be returned back to liquid concentrate to replenish or strengthen the flavor of final products. Other industry methods of aroma retention incorporate microencapsulation technology into the spray-drying process or adopt freeze-drying to better preserve aroma and freshness when making soluble powder from concentrate. Exhausted tea leaves are not wasted, as they can be sent back to nearby tea gardens as a natural fertilizer. In case there are no tea gardens in the vicinity, these resides could be made into compost.
Since water is used as a solvent in the first step, lipo-soluble pesticides are effectively blocked from entering into the infusion. According to an industry expert, heavy metals and 70% of water-soluble pesticides can also be blocked during the first step. However, pesticide control of the source materials is still a necessity as organic phosphorus pesticides dissolve quickly in water.
In China, commercial production of tea extracts started in the 1980s. It was a time when tea industry experienced great changes as the government implemented its decentralization policy in the area. The new policy stimulated growth in both tea production and sales, yet, it also brought fierce competition and caused subsequent overstock of off-grade tea and lower grade tea. Entrepreneurial tea producers ventured into tea extraction business with the intention to transform overstock problems into new concept tea products that changed the traditional “slow” consumption pattern and expanded the consumption of tea. Tea polyphenols (TP) was the first “partial extract” that gained market acceptance. It was mainly promoted as a natural antioxidant. As the food industry was facing the controversy on toxicity of synthetic antioxidants, TP became an effective and safe substitute. RTD and instant tea were then still at the trial and error stage, as consumption habits, precipitation and acceptance of the taste were some of the problems faced by RTD tea producers.

Fully industrialized
The tea extraction business had been fully industrialized by the 1990s, followed by a rapidly booming period in the 2000s. The speedy development was driven by advanced extraction technology as well as the fast expanding RTD and instant tea market in China. China launched its first RTD tea brand “XuRiSheng” in 1993, which turned out to be a big success that attracted many investors into the RTD tea business. In two decades, RTD tea grew to be the second best-selling item on the cold beverage market with a share of 20% in sales volume. The China Beverage Industry Association (CBIA) estimated that China RTD tea production had exceeded 7million tons by 2009. According to industry observers, RTD tea keeps an astonishing annual growth rate of 30% and has remained as the leading consumer of tea extract (including both liquid concentrate and soluble powder) in recent years.
In the RTD tea sector, black ice tea (flavored) is the most popular variety, with ice lemon tea being the top-selling flavor. Most black ice tea is made from tea powder, especially cold water-soluble ones that are specially treated during extraction to eliminate precipitation in cold water. Green ice tea (flavored) is the second most popular variety with “honey green” and “jasmine green” as the two trendy flavors. Since freshness is a selling point of green ice tea, it is mainly made from liquid concentrate, which is less processed than soluble powder. Some high-end brands also use freshly brewed green tea to replace intermediate tea extract for fresher taste. Ice oolong is a niche market variety and original flavor (sugar-free and less-sugar) remains the favorite classic. Ice oolong is a marginal product that is restricted in first-tier cities where consumers are more health conscious. Ice puerh is a relatively new variety that is intended to copy the success of ice oolong by advocating health benefits and naturalness.
Another key use of such tea extract as soluble powder is instant milk tea. Lipton had launched milk tea in the late 1990s and flavored milk teas in 2004, however, these sachet packed products did not get strong support from the market. The popularity of milk tea was ignited by cup milk tea in 2005 with “Xiang Piaopiao” as one of the most successful brand. A few small changes determined the great success of cup milk tea: firstly, the design of the portable foam-cup and straw made the tea easy to prepare, secondly, it included an accompanying packet of tapioca pearls or nata de coco that enhanced the mouthfeel of the beverage. Since then, cup milk tea has grown to be the second most common use for tea extraction products.
Cup milk tea usually uses either black tea powder or green tea powder as tea base to be blended with non-diary creamers, sugar and flavorings. This sector of tea consumes nearly 30% of all soluble tea powder. As there is no worry about precipitation, hot water soluble tea powder is widely used. Among assorted flavors on the market, Classic Milk Tea (black tea) and Milk Sencha are two popular choices.
The trend in the RTD and instant tea market is well reflected in the product mix of tea extracts. Some 80% of tea extract is produced in the form of tea powder, which is more stable than a liquid concentrate. Approximately 80% of these tea powders are black tea powder, 10% are green tea powder (including jasmine tea powder) and the rest are oolong, white and others. China is a green tea producing nation – only 6% of its total tea output is black tea. Last year’s total black tea output was merely 90,000 tons. In foreseeable future, black tea production is unlikely to increase dramatically. If strong demand for black tea powder continues to grow, domestic black tea supply may fall short. The rising cost in domestic tea production and a stronger RMB also caused tea extraction producers to look for cheaper alternatives overseas.