STiR coffee and tea magazine

22 STiR coffee and tea / Issue 1, 2018 (February / March) capita figure is in the range of 0.6 kilos a year. This is equivalent to 0.7 cups a day. The highest DCPC (daily cups per capita) is Turkey, slightly under four cups. Ireland is in second place, ahead of the UK, at 2½ cups. Of the top 10 consumers (averaging at least one per day), 4 are Muslim countries, and mainly green tea drinkers: Turkey, Morocco, Egypt, and Saudi Arabia. Five are traditional black tea cultures: Ireland, UK, Russia, New Zealand, and Poland. Except in Russia, demand for black tea is falling; in the UK, the decline has been consistent and amounts to 20% in under a decade. The search is one in the industry to tap the growing interest in green tea and flavored infusions. Russia drinks little non-black tea. As average family incomes shrink they are buying more commodity imports and fewer premium teas. These are all mature markets. Growth in any one segment comes at the expense of another – green tea instead of black, herbal eating into caffeinated teas and tea versus coffee. The areas of most opportunity are likely to be markets that should already be larger. One of the striking figures is the extent to which the top producers rank so low. Japan is in ninth place, and one of the few top ten producers that is a high domestic market. Here are the DCPC for the top 10 growing nations (kilos per capita): China 0.7, India 0.4, Kenya 0.5, Sri Lanka 0.5, Indonesia 0.3, Vietnam 0.5, Iran 1.1, Argentina 0.1. All of these are noted for their tea cultures built on long history, ceremony and tradition. This perspective obscures the DCPC issue: they may be deep-rooted but they relate only to a small part of the population. Most of the population has no investment in tea. They are thus far more open to innovative, non-traditional teas than the high consumer mature markets. India and Taiwan have massive upside potential. Any Asian market with a growing younger population with discretionary spending power is a target for beverage products that explicitly abandon tradition. That seems to be very much the pattern in most of Asia. Bubble tea in Taiwan, cheese tea in China, Japanese foody infused and alcohol teas, India's new chai out-of-the- home cafe. If the tea industry arbitrarily assumes one DCPC as a reasonable target, societies that have a strong tea awareness but average around half that figure represent immense and incremen- tal growth. The same is potentially the case in East Africa, where tea drinking is miniscule. Nepal is an eccentric: rapidly growing in its production of superb teas and barely sipping them. There is one market that when viewed from the traditional measures of volume stands out as healthy and huge. Switch to per capita drinking and it looks, well, weird. This is the US, with large imports, superb online and physical store infrastructures, supermarket variety, blogs, deals. Buzz. But it consumes less per person than most Scandinavian nations, the bastions of coffee and by far the world's highest caffeine infusers. Its .25 DCPC is a third that of Germany, not thought of as a tea culture, and little more in than France. This partly reflects how much of US "tea" is cold, not hot, iced and ready to drink teas. The US is an low consump- tion market with huge potential. This brief per capita focus on tea is impressionist but seems useful in opening up new ways of thinking about the dynamics of markets, rather than their size. SRI LANKA Farmers Fight Glyphosate Ban The dilemmas of the organic/pesticide debate are strikingly captured in the protests against the 2015 ban on glyphosate by the Sri Lankan govern- ment. This leaves Sri Lanka as one of just five countries that ban the chemical weed killer. Farmers have reported growing crop losses that leave them at a "crippling disadvantage" in world markets. The chairman of the Sri Lanka tea board points to the increase in the use of unauthorized alternatives and contraband smuggled from India and sold at five times the world price. Glyphosate is the world's most widely used weed killer, with most of the main alternatives, such as paraquat, banned or restricted. It is the active chemical ingredient in Monsanto's controversial Roundup. At the core of the controversy, as is so often, are contested scientific claims and social concerns that turn into political activism. The politics of the Sri Lanka ban transcend science and economics, with accusation of lack of good faith on both sides. That began with the ban itself. It was made with no announcement or consultation through a presidential order in 2015. This was triggered by a single study that suggested a possible connec- tion between glyphosate and a chronic and long-lasting epidemic of chronic kidney disease that killed many thou- sands of agricultural workers in hot, dry areas of the country. Excessive use of agrochemicals has long been assumed but not proven to be a primary cause of the disease which has affected similar areas in Central America, India and Egypt. The counterargument has been that the cause is water contamination and that there is no evidence to justify the ban on glyphosate. Farmers report heavy cost increases for weeding, which amount to close to 29% of production expenses. Where fertilizer application is delayed by weed and pest issues, crop losses may be in the 25% range. The tea board puts the cost in the 18 months after the ban as amounting to $100 million of export revenues. Workers are migrating to towns as overgrowth and low yields cut jobs. The glyphosate issue is not clear cut and controversy is not confined to Sri Lanka. In 2015, the UN's International Agency for Research on Cancer reported that it is probably carcinogenic to humans. In 2015, the UN's Food and Agricultural Organization reported that it is not. The World Health Organization found no evidence either way. The EU Commission's vote in late November 2017 on whether to renew the license authorizing glyphosate use for five more years was just as split. There was early strong opposition, many abstentions and a final narrow decision to approve the extension. Germany swung the balance in favor, in opposi- tion to the firm No vote by France. The debates and policy fights will not disappear or be easily resolved. Sri Lanka is just one arena and glyphosate one agenda. US Millennials Shun Iced Tea American millennials may be losing their taste for iced tea, according to results of a poll released this month by YouGov

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