India’s tea export likely to be down by 10% this year

Kolkata

India’s tea export is likely to be down by around 10 per cent this year compared to last year, mainly due to a significant decline in export to Iran. The country’s tea exports stood at 231.08 million kg (mkg) in 2022 calendar year.

“This year tea exports will be down compared to last year. We expect about a 10 per cent decline. This is mainly due to the Iran market. Our export to Iran has dropped significantly due to a blocking of allocations of foreign exchanges there for the import of tea,” Indian Tea Exporters Association (ITEA) chairman Anshuman Kanoria told businessline.

“Iran is now gradually opening the blockings of foreign exchange allocation, but not much foreign exchange allocations are happening. Luckily, our exporters have taken a big risk and penetrated markets like Iraq, Jordan and Syria by exporting larger quantities. Otherwise the fall would have been even more,” Kanoria said.

Other nations also hit

According to Tea Board data, India’s shipment of tea to the international markets was 157.92 mkg during January to September compared with 166 mkg in the same period last year.

Notably, this year exports are also down from all other major tea exporting countries such as Kenya, Sri Lanka and China due to geopolitical disturbances and subdued economic conditions. Interestingly, global tea production is higher in 2023 compared to 2022.

“From January to September this year, India’s export is down by around 8 million kgs. Almost all countries have contributed to this lower exports. Exports to Iran, Russia, CIS countries and the United Arab Emirates fell,” said industry expert and former Indian Tea Association (ITA) secretary Sujit Patra.

This year, India can at most achieve the 2021 export level, which was at 196.54 mkg, Patra said.

Iraq, Turkey & China buy more

Despite overall decline, the country’s exports to Iraq, Turkey and China have increased. “After two-three years, India’s export to China has grown slightly this year. Amid a gloomy export picture, growing exports to Iraq and Turkey is a silver lining for our exporters,” Patra told businessline.

“Export is down not only from India. Exports are also down from all other major tea exporting countries such as Kenya, Sri Lanka and China. Global tea exports were down by around 80 million kgs till September 2023, whereas production was up by around 30 million kgs compared to last year. As a result, prices are low worldwide,” he said.

ICRA Vice-President and Co-Group Head Kaushik Das said export will definitely be lower for India. Tea exports to Iran witnessed around 90 per cent decline by September this year as the country is purchasing a lesser amount of the brew.

“India’s price realisation in the export markets remains lower compared to last year due to depressed demand conditions globally on the back of geopolitical issues and adverse economic conditions,” Das said.

According to him, Sri Lanka’s export was lower by around 6 per cent upto October this year, while that of Kenya was lower by around 11 per cent till August.

Patra said India needs to make concerted efforts in traditional key markets and new markets such as Iraq and Turkey. “The government should try to make PTA (preferential trade arrangement) with Bangladesh for export of 15-20 million kg of tea of neighbouring places like Dooars, Terai and Cachar as India has done with Sri Lanka some time back,” he added.

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