Issue link: http://read.dmtmag.com/i/612330
38 STiR tea & coffee industry international / Issue 6, 2015 (December/January) Form, fill and seal line at QTrade Tea & Herbs than a single shipload of smart phones. Yet tea merits presi- dential attention. Xi Jinping cited development of the an- cient silk road economic belt and the maritime tea trading routes as China's new "one belt, one road" approach to the global economy. Tea is China's greatest ambassador, he declared, promising "a great rejuvenation" of the Chinese economy. In the 1990s China designated several provinces to become export engines for tea. To insure consistency demanded by Western grocers and brands, former state- owned firms like Zhejiang Tea Group planted hundreds of thousands of acres of identical cultivars. Founded in 1950 and shipping 40,000 metric tons annually, Zhejiang Tea Group is now the largest exporter of green tea in the world. To increase production the traditional exporting prov- inces of Zhejiang and Fujian were joined by lesser known but very productive tea regions such as Guizhou where ex- ports increased by 74 times in 2014. The big driver was clean soil that could be easily certified organic. The US is now the fourth largest tea importer in the world. Green tea consumption in the US was less than 10% in 1990 a time when total tea sales were less than $2 billion. Specialty teas were rare. Consumption has since quadru- pled and the tea market is valued at more than $10 billion. Green teas (including white tea) now account for 22.5% of tea processed in the US. Americans still consume black tea for the most part, a segment that accounts for 57.7% of processed tea. The remaining 19.8% is herbals, according to IBIS World. US blending capability The great majority of tea consumed in the US and Canada is produced overseas by industry giants like Tata Global Bev- erages (Tetley-Good Earth) and multi-nationals like Twin- ings and Nestle (Nestea). Unilever (Lipton) has operated the largest tea bagging facility in the US since 1955. To meet US demand the company recently invested $96.2 million in new production machinery for its facility in Suffolk, Va. At a time when the nation's GDP was rising at 2.5% the pace of growth of the US tea blending and filling industry's topped 6.9%. In 2012 Zhejiang Tea Group made its move, opening an ISO 9001 certified distribution facility in New Castle, Delaware. The 7,578 sq. ft. fills and packs for large enter- prises offering a range of services from its Chinese head- quarters that include de-caffeination, tea extracts, and prod- uct development. The firm intends to expand in 2017 to a full-service US blending and tea manufacturing facility. "We are seeing increased demand in the US market for better quality tea as well as quality assurances from a reli- able source," says Shengyuan Chen, executive director of Firsd Tea North America. Also notable is tea's broadening market penetration. Tea is now transcending gender lines as well as age cohorts. Among the emerging adopters for tea are millennials with as many millennials consuming tea as those consuming coffee, she said. Green tea remains the fastest growing segment. The $5 billion RTD tea category is certainly a growth driver, observes Chen. "Consumers are increasingly disenchanted Continued on pg. 41 Firsd Tea workers filling pouches of green specialty tea. Photo courtesy Firsd Tea North America, LLC Photo courtesy QTrade Tea & Herbs