STiR coffee and tea magazine

38 STiR coffee and tea | 2024 Issue 4 (August / September) E thiopia, which earned $1.43 billion last year by supplying 22% of the world's coffee, recently revealed its early efforts to bolster tea exports. Inspired by Kenya's success as Africa's leading tea producer with annual foreign exchange earnings of $1.22 billion in 2023, Dr. Adugna Debela, the Ethiopian Coffee and Tea Authority's director general, said in July that 30,000 hectares of new farms are under development and that 460 million seedlings have sprouted in govern- ment-subsidized nurseries. Prime Minister Abiy Ahmed predicted, "if we plant these seedlings and nurture them to production, it will have a great impact on our overall economy." Debela said Ethiopia "has only scratched the surface of its potential" in the tea industry. Buyers responded with a collective sigh. Globally, tea export volume is slack, and value is in decline. According to China Customs, Chinese tea exports fell by 16.3% to $1.74 billion year over year (y/y) in 2023, compared to $2.1 billion in sales recorded in 2022. The decline is the second consecutive annual drop in tea export value. Export volume also declined by 2% to 367.5 million kilos. Export value in 2022 fell by 9.6% y/y compared to 2021. Analyz- ing UN Comtrade data, Daniel Workman at World's Top Exports writes that global sales of exported tea from all countries totaled $7.87 billion in 2022, down y/y from $8.62 billion traded in 2021. "Tea sales are up by a flatlining 0.2% since 2018," he said. "Does no one at ANY level of government in ANY tea-producing country get that the world already has a massive oversupply of tea?" writes Jem McDowall, VP at Universal (Tea) Commodities. Debela acknowledged that limited investor involvement in the sector has con- strained Ethiopia's ability to capitalize on its abundant resources and generate substan- tial foreign exchange. He told the Ethiopian News Agency (ENA) that annual earnings Driving Demand Tea is the original, affordable, plant-based health and refreshment drink, but innovative beverages erode its enviable share of the global beverage market. Regional surpluses and low prices dem- onstrate suppliers' out-of-sync with their markets. Limiting output won't restore equilibrium—the solution is to increase demand. Ethiopia has sprouted 460 million new tea seedlings in a massive effort to increase tea production. Dr. Adugna Debela is the director general of the Ethiopian Coffee and Tea Authority. By Dan Bolton from tea exports have yet to surpass the $3 million mark, highlighting the indus- try's vast untapped potential. There are currently 275,000 hectares (about 679,000 acres) of land under tea in Kenya, 45,000ha in Uganda, 26,000ha in Rwanda, 23,000ha in Tanzania, and 21,600ha in Malawi. Ethiopia's ambi- tions will increase Africa's tea lands to 425,000ha, more than one million acres. Ethiopia's tea authority estimates that 6 million ha of land are suitable for tea.

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