STiR coffee and tea magazine

40 STiR coffee and tea | 2024 Issue 4 (August / September) son—enough to make 2-3 cups a week, compared to the 8-10 cups consumed daily in Türkiye and Ireland. Disrupting the Oversupply Cycle If governments eliminated subsidies (in favor of low-interest loans), abandoned floor prices, removed import duties on equipment for tea growers, set higher quality parameters on green leaf, and stopped front-loading, the supply surplus would persist. Balancing supply and demand in the long term will require governments to allow tea land to be converted for other purposes (including value addition). Mc- Dowall writes that governments should "allow the bottom 5-10% of producers in every country to go to the wall. Support the workers with other work, but let's call a halt to zombie businesses drowning the rest of the industry. For those farms large enough, help farmers diversify crops and/ or provide help in forming cooperatives." Addressing growers, Snell writes, "Yield is not the panacea for all your woes. In fact, without commensurate investment in factory capacity, yield improvements harm your bottom line. Irrespective of how fine you pluck, ac- commodating more leaf than factory ca- pacities inevitably leads to poorer quality and lower sale prices." In its January Global Market Report Tea Prices and Sustainability, the International Institute for Sustainable Development (IISD) writes that plain-quality tea production is growing at a higher rate than demand, with a surplus of product and subsequent low prices for bulk commodity tea, specialty tea production provides higher returns to farmers. "While volumes produced outside China and Japan remain small, they in- crease as farmers elsewhere become aware of this opportunity," writes IISD. Embracing quality presents a significant opportunity for small-scale growers. The FAO estimates that 9 million of the 13 million people employed in the global tea sector are smallholder farmers in developing countries who produced 60% of the world's tea in 2022. Smallholders produce 80% of tea grown in China and Vietnam, and more than 50% of that grown in India, Indonesia, Kenya, and Sri Lanka— and the proportion of smallholder-grown tea is rising globally. The IISD report endorses third-party certification. More than 1 million farmers produced between 1.67 and 2.06 million metric tons (Mt) of Voluntary Sustainability Standards (VSS) -compliant tea with a farm gate value exceeding $155 million, an in- crease of 300,000 kilos over the previous year. Between 25% and 31% of global tea production is VSS-compliant. The most prom- inent VSSs in the tea sector, ordered by 2019 production volumes, include Rainforest Alliance (1.33 Mt), Organic (0.41 Mt), Fairtrade (0.18 Mt), and UTZ (0.14 Mt)1 (Meier et al., 2021). Growing at a CAGR of 29-31% between 2008 and 2019, VSS-compliant tea represented 25-31% of total global production in 2019. Despite this impressive growth, there are signs that the supply of VSS-compliant tea may be slowing as its CAGR dropped to between 12-13% from 2014 to 2019. Another major challenge tea producers face is the large amount of VSS-compliant tea sold as conventional. For example, Fairtrade-certified smallholder tea producer organizations sold only 7% of their production on Fairtrade terms in 2020 (O'Brien, 2022). Tea farmers who cannot sell their product as VSS compliant may not receive premiums and struggle to pay certification costs (O'Brien, 2022). This can be very problematic, as some farmers need to comply with more than one scheme to meet buyers' demand, thus increasing their certification costs, which they do not recover if their produce is not sold as VSS compliant. Five Paths to Increase Demand Here are five paths and pathfinders to follow to increase demand. 1: Marketing, and Branding and Targeted Advertising Actress and influencer Lindsay Lohan currently appears in television advertisements and social media for Pure Leaf bottled tea, owned by the Pepsi Lipton Tea Partner- ship. The 90-second spot is the first multinational, multimillion-dollar campaign since the pandemic. In the commercial, Lohan calls on her coworkers at her production company to take a break. "It's like we forgot breaks even exist," she says. "We all need a moment to recharge and revitalize ourselves." The campaign resonates with office workers surveyed by creator Edelman. The agency queried 1,010 full-time workers and found that three-fifths struggle to take breaks. Sixty-three percent of the respondents said that when they take quality breaks, they return to work recharged. The United Nations Intergovernmental Group on Tea (IGG/Tea) directly con- fronted the challenge of reversing the current slump in popularity following a pan- demic peak when sales of tea for home consumption surged by double digits in many world markets. As co-chair of the Working Group on Tea & Health, Shabnam Weber, president of the Tea and Herbal Association of Canada, says that young tea drinkers are the catalyst the industry needs to innovate and grow. "There is extensive evidence supporting tea benefits in sports and fitness perfor- mance and optimal hydration," she explains. "These scientific findings provide the framework for a youth-focused campaign to encourage increased tea consumption." #TeaPower is "the perfect pitch for younger generations looking to increase their per- formance and energy levels while staying healthy." The social media campaign debuted at this year's International Tea Day in May. Lindsey Lohan wants to bring back tea breaks.

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