What you should know about global black tea export

Have you wondered how global black tea exports have been recently? Let’s update some helpful news in this article.

Contents

Introduction

Tea is the second most popular drink in the world, only after water. In 2021, tea ranked 406th in terms of global trade, and most of them are black tea. In this article, FGC will introduce some information about black tea export, including black tea export situations and the challenges that exporters are facing.

Recent black tea export situation

Among all tea categories, black tea accounts for the highest proportion, at more than 75% of total global tea production. The most famous black tea producers are India, Sri Lanka, and Kenya, with signature tea being Assam, Darjeeling, Ceylon tea, etc.

Black tea export is divided into two groups, including Tea, black (fermented or partly) in packages < 3kg and > 3 kg. Black tea export in packages > 3kg was dominant, at US$ 3,72 billion in 2021, while the figure for the other was US$ 2.07 billion. Top black tea exporters of larger packages are Kenya, Sri Lanka, India, China, and Vietnam, and Kenya was the leading with US$ 1.16 billion export value in 2021. Meanwhile, Sri Lanka, United Arab Emirates, Poland, China, and India were the top five largest exporters of Tea, black (fermented or partly) in packages < 3kg group.

Chinese tea exporting has been developing strongly recently, making it the largest tea exporter in the world. Regarding black tea export, even though China was not the leading country, it was the nation with the fastest growth rate. Over the last decade, world black tea exports recorded a minor increase of 0.1%. In the medium term, black tea exports are anticipated to rise by 1.4%, thanks to the expected increase in shipments from Kenya, the top exporter of this product type.

Black tea export situation of leading exporters

Black tea export in Kenya

Although tea was first planted in Kenya in 1903, this country is currently one of the leading tea suppliers in the world. As most of Kenya’s tea production serves the global market, it has become the biggest black tea exporter. Pakistan is the main destination of Kenya’ black tea. Black tea export from Kenya is well-known for its flavor, aroma, briskness, and high quality. It is because more than 90% of tea leaves and buds are picked by hand and selected carefully to create a competitive feature in the international market.

However, recently black tea export in Kenya also has faced some challenges, including climate change, restricted destinations, high competition from India, Sri Lanka, and China, impact of Covid-19 and Russia-Ukraine conflict. The worst drought over four decades in East Africa has hindered the tea production, reducing Kenya’ black tea export volumes.

Kenya black tea export — Kenya is the leading black tea exporter

Black tea export in Sri Lanka

2022 was a tough year for Sri Lanka, witnessing a drop in black tea export volumes and values. The Russia-Ukraine conflict has had a huge impact on the black tea export of Sri Lanka since these two countries have been its biggest customers, mostly for bulk and orthodox teas. Last year, Russia bought only 20 million kilograms, 9% less than in 2021. Meanwhile, Ukraine hardly purchased anything in 2022. There was also a fall in the black tea export to other nations, such as Turkey.

Not only the export volumes, but the export values from Sri Lanka also experienced a decrease. Japan, which usually buys the highest-priced Ceylon tea, saw a 40-45% in orders, resulting in the decline of the value term. Additionally, the black tea export values were reduced because of the depreciation of the rupee compared to the US dollar.

Besides, the economic crisis leads to inflation, material scarcity, appreciation, and foreign debt, which also negatively affects black tea export activities. However, increased exports to Iraq, the UAE, and Poland helped recover the loss. In 2023, the tea sector is expected to become stable, so are the black tea export activities.

Ceylon black tea — Sri Lanka’ ceylon tea (Source: Internet)

Challenges of the global black tea export

Global economy has been experiencing the dark hours. Because of the negative impacts of Covid-19 and conflicts among nations, black tea exporters have faced many difficulties.

Covid-19 pandemic

Over the past four years, Covid-19 has caused numerous negative impacts on the global economy, especially trading activities. Tea trading, in general, and black tea exporting, in particular, also faced some challenges because of lock-down policy and reduced out-of-home consumption. To prevent the spread of the pandemic, most countries had to go through lock-down periods, leading to the stagnation in logistics activities.

As a result, black tea export prices, including CTC and Orthodox teas, fell down by 12% in 2019 and continued to decline until 2021. However, in 2022, the price started to show some positive changes when the trade restrictions were gradually eased.

Russia-Ukraine conflict

In addition, global black tea exports are also adversely impacted by the Russia-Ukraine conflict. The Russian Federation is one of the largest black tea buyers, the main destination of black tea from India, Sri Lanka, and Kenya. Besides, as Russia is a major fertilizer supplier, the conflict has led to the increase in the fertilizer prices. This price fluctuation then affected the tea quality and prices.

challenges of black tea export — Covid-19 and Russia-Ukraine conflict have some negative impacts on black tea export

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