Building a Wider
Horizon With Labour
Just Tea is a collaborative project of Centre for Education and Communication (CEC) in India, FAKT in Germany and Traidcraft Exchange in the UK. The project seeks to identify how the tea industry could have an improved economic and social impact on Indian smallholders and workers having been made aware of the increasingly poor terms of trade in the global tea market leading to the subsequent collapse of tea plantations across several of the traditional areas of production. This has resulted in devastating economic and social impacts on those dependent on tea for their livelihoods. In this context, this first phase of the research concentrates on the UK tea market; firstly the overall market place and then more specifically the market for Indian teas. As the world’s fourth largest importer of Indian teas at around 21,000 Metric Tons per year, although thought to be gradually reducing, the UK market is considered to be one of great importance to Indian producers. The tea industry in the UK is changing to adapt to the ever increasing needs of a competitive market place where profitability is key to success and survival. With reduced consumption predicted in the coming years and the ever growing competition from other products such as soft drinks always in the background, quality is essential for entry into the premium end of the market place where growth is still envisaged. Brands have taken over from the smaller packers and now the market is dominated by half a dozen brands of which there are only two real market contenders. The overall quality of tea on the market shelf has declined significantly over the last 10 years and with the global oversupply of tea on the world market, blenders/packers have the ability to choose from a wider range of options to meet their blend specifications. The Indian tea trade has suffered greatly from working within the confines of a ‘protected market’ for so many years. Under the old regime of barter trade with the USSR, factories were not encouraged to keep up with new technologies and keep their cost of production low through efficient management, as there was always a guaranteed market for their tea. Under the new system of open trade, other more economically viable countries have undercut the Indian producers on price and have taken their traditional export markets. The smallholder group has expanded rapidly during this time and is now an additional concern to the Tea Board as to how it will provide an infrastructure of support to engage with producers. If the population of India continues to increase, exports may not be a viable option open to producers although at the moment India is the largest producing as well as consuming country in the world. The Supply Chain of tea is a complex one with several companies playing different roles along the way. However the options for marketing Indian teas are explored and possible new routes considered.
