STiR coffee and tea magazine

STiR coffee and tea 15 NEWS Countries like India, Kenya, Vietnam, Indonesia, and others should make a much greater effort to adopt policies that target a greater scale of value addition, enabling them to conserve quantities and/or earn more on their relevant commodity tea. Our Smart Line machines make it economically easy to get into the value addition in these countries. STiR: Tea packing is experiencing significant innovation in polymer reinforcement, shape, and characteristics of filter papers such as composability and recyclability. Will you address the innovations you find most promising and explain why? Pirouz: We are in partnership with Glatfelter's composite fibers business unit, the industry's main supplier of quality non heat-sealable and heat-sealable filter paper out of Germany, France, and the UK. Glatfelter focuses on providing our clients with a range of options that gives them choices as to how they serve the market. We have developed papers which have less reliance on abaca by using alternative cellulosic fibers that maintain both excellent conversation and endurance performance characteristics. When it comes to heat sealable filter papers Glatfelter has led the way in using currently available bioplastics to replace standard oil based aliphatic hydrocar- bons such as polypropylene. Glatfelter assures me that by way of this substitution Glatfelter has now developed a range of papers which contain fibers that are biodegrad- able and industrially compostable and can run on all major machine platforms such as HST, Teepack, IMA, ACMA, Maisa, DPH's Smart Line, and others. So, while offering excellent particle retention, superior infusion, and conversion characteristics, Glatfelter provides a more envi- ronmentally friendly product profile. We at DPH are also working closely with Rychiger AG from Switzerland, the leading manufacturer of capsule filling and sealing machines. They also are working towards environmentally friendly materials for the capsule use that we all hope will be successful and serve our market. STiR: Packing is the greatest source of value addition in the tea industry. Describe how adding value near origin can benefit growers facing increasing costs of production. Pirouz: Teabags require about half the amount of loose leaf tea used to make a cup. This is an indication of the huge potential impact of what could be saved, if we make full use of controlled consumption. This is critical because a growing population, rising middle class, and greater urbanization in developing countries is going to increase demand. At the same time a combination of climate change, water shortages, an overall decrease in the amount of agricultural land, and increasing competition between food crops is going to reduce supply. Value addition begins with the process of the tea preparation as it is dried, cleaned, cut, blended, and packed. A market which has successfully implemented the value addition will create jobs, increase wages, generate taxes, encourage spending, and increase the nation's gross national product. The whole macro- economic chain is set into force to the good of these countries' economic framework. Each link adds value. Machines are being engi- neered and produced, wages are being paid, and last, but not least, the packing itself enables us to ask for higher prices per packed volumes. At present, except Sri Lanka, Japan, and South Korea, most of the tea growing countries are a long way from incorporating teabag packing into their markets. They still export big volumes unpacked. Countries importing these teas in bulk in Europe or the US have installed the value chain into their markets and have the most benefit of earnings through adding the value chain. In the UK 96% of tea is consumed in teabags; in Germany it's 92%; and in the US it's 65%. As production costs rise and competing crop management in the countries of origin reduces the amount of land available to grow tea, the question arises: Why not establish a value chain in the country of our tea's origin so that suppliers in-country can begin with planting and end by packing tea in teabag formats? The opportunity to create significant earnings is obvious. Our company and team would be ready to consult and lead with support to everyone who asks for. We have concepts, the different machines of different choice, the materials, and offer technical and financial services. STiR: Describe how value addition can capture foreign exchange revenue to expand exports and offset social costs that better the lives of workers. Pirouz: Packing tea within the country of origin, as you see in Sri Lanka, for example, boosts the entire country's GNP. You can generate much greater income than you spend buying machines and materials and building the necessary infrastructure. This was demon- strated by Teepack after they invented the teabag packing machine in the early years and thereafter sold a big number of machines worldwide. For the economy it is much cheaper to invest in machines, materials, and services and build up the value chain and earn the relevant income in hard currencies such as US dollars and euros. This can be done at a much greater scale at the point of origin compared to spending year by year an enormous foreign exchange amount to import tea to satisfy the demand in the market. The value chain in the country of origin improves social costs that benefit the whole circle - labor, wages, taxes, spending, and a growth of the GNP - while controlling volumes needed to make our cup of tea. Tea importing countries save hard currencies they would otherwise have to spend for their imports; those countries who grow tea reduce the volume for local consumption so there is more tea available for export, earning additional income.

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