STiR coffee and tea magazine

STiR coffee and tea 39 Another program is Trinitea, a support program for small tea growers created by the sustainability organization Solidarid and the producers' body, Indian Tea Associa- tion. Shatadru Chattopadhyay, Solidaridad Asia's managing director, talks about the ITA opening memberships to STGs as an historic development. If RTGS and STGs can work together, as is proposed by trinitea, he feels change is possible. He points out that, "Large gardens have the knowledge, while small gardens have younger bushes and higher yields." Jalan echoes this sentiment: "The industry and the government must recognize and accept that STGs are here to stay and are an integral part of the industry. They must be represented and involved in all negotiations and discussions pertaining to the industry. A conscious effort needs to be made to ensure that there is a level playing field between the unorganized and the organized sectors within the tea industry." The market for Indian tea Even if one argues that bringing STGs up to minimum quality benchmarks may cause a natural adjustment in production volume, there's still a stagnant consumption mar- ket. In 2018, the Tea Board of India commissioned Deloitte Consulting to assess tea production and study domestic consumption patterns. The study indicated that the domestic preference had increased for packaged tea (especially in tier 2 and tier 3 cities), and for green tea. This was seen as a market op- portunity. Domestic consumption is high at 80% compared to exports, but per capita con- sumption remains low at 750g (Source: ITA); it's almost 2,000g in the UK and about 1,500g in Iran. The study also showed that tea is consumed in 88% of Indian households, with overall penetration of 96%, but relatively little is consumed outside the home. Tea veteran Indi Khanna says, "We have a large domestic market. We are relying on the domestic market. Internationally, we are up against Kenya for CTC and Sri Lanka for orthodox tea." But how can the domestic market be tapped to increase per capita consumption by 50-100g, which incidentally will correct the demand-supply mismatch? One option is to put the onus of marketing on producers or producer bodies. Mrinalini Srivastava, managing director of Sikkim's Temi Tea Garden, says, "When we realized we were not getting the right price at auctions, we disengaged partially. The retail market allowed Temi to build and promote its brand. We are aiming to sell 50% of our production in the retail market." Until 2001, producers were mandated to sell 75% of their tea via the auction. Al- though this has now changed, the auction remains a significant distribution channel for tea, with about 500mn kg of bulk tea sold via auctions annually. India's six auction centers have been consolidated into an online e-auction portal. In 2020, the chairman of the Tea Board, PK Bezbaruah announced his recommen- dation that the Board should disassociate from the auction system to make way for a liberalized open market. This was lauded by the industry, which remains fragmented for the most part, func- tioning in silos. Where everyone has come together and is on the same page is in their expectations from the Tea Board, a government body established in 1953, that sets the mandate for tea cultivation, production, sales, and exports. Of the board, the stakeholders all ask the same questions: Can it cease to be a regulatory body, and instead become a proactive promoter of Indian tea, speaking for and protecting the brand, strengthening old markets, creating news one? Can it step away from interfering where efficient systems exist and instead focus on introducing mechanization, on product innovation, on climate change research? Can it become the body the Indian tea industry actually needs? The answers to these questions may well provide the solution the industry desper- ately seeks. With inputs sought from Raju Lama, Sonia Jabbar, Bijoy Chakraborty, Indi Khanna, Manoj Archibald, MN Bopana, K. Gopal Krishnan, Mrityunjay Jalan, Mrinalini Shrivastava, Rajesh Bhuyan, and Shatadru Chattopadhayay.

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