Tea market in India

Earlier Report Observations

Between 2018 and 2023, India's tea production volume fluctuated, influenced by the Tea Board of India's regulatory control under the Tea Act, which focused on increasing output and improving quality. Consumer preferences simultaneously shifted toward premiumization, with a growing mass-premium segment and the emergence of specialty teas like green and botanical varieties, supporting both market volume and value.

The COVID-19 pandemic in 2020 led to a temporary production decline to 5.5 million tons, disrupting supply chains. However, it accelerated consumer interest in teas with health benefits, establishing tea as a wellness beverage and fueling a recovery in 2021. This rebound was further driven by a 17% increase in export prices from 2018-19 levels and the Tea Board's promotion of packaged Indian tea for exports.

Innovation in functional teas targeting stress relief and immunity, along with Ready-to-Drink products, catered to evolving demand in 2022. By 2023, climate change impacts, including high temperatures and reduced rainfall, caused significant production challenges, leading to a 20% reduction during peak months and a decrease in output to 6.0 million tons. Despite this, the premiumization trend continued, with consumers seeking luxury teas emphasizing quality and traceability.

Production tea in India

In kind, 2017-2020, K t

From 2017 to 2020, India held the second position globally in tea production.

Top producers of tea, 2017-2020

World map of production of tea, 2017-2020

Following two years of growth, India's tea production volume experienced a decline. In 2020, India produced 5 485 K t of tea, representing a 9.2% decrease compared to the previous year. Over the 2017-2020 period, production fell by 4.8%, with a compound annual growth rate of 1.6%. The highest production level was recorded in 2019 at 6 044 K t, which also saw the largest annual increase of 3.8%.

Annual dynamics of production in India in kind, 2017-2020, K t

In value, 2017-2020, M $ US

After two years of gains, tea production in India saw a downturn. In 2020, the output of tea was valued at 18 035 M $ US in India, marking a 5.4% decrease from 2019. Between 2017 and 2020, production increased by 6.5%, translating to an annualized growth rate of 2.1%. The peak value was recorded in 2019 at 19 060 M $ US, which also experienced the largest annual increase of 12.2%.

Annual dynamics of production in India in value, 2017-2020, M $ US

Exports tea from India

Exports in kind, K t

Tea exports from India declined for the second consecutive year. In 2020, export volume reached 210.5 K t, showing a significant year-on-year drop of 18.4%. Over the 2017-2020 period, exports decreased by 19.5%, with a compound annual growth rate of 7.0%. The highest export volume was recorded in 2018 at 262.4 K t, which also saw the largest annual increase of 0.4%.

Annual dynamics of product's exports from India in kind, 2017-2020, K t

From 2017 to 2020, the country structure of exports in kind was highly diversified. Russia accounted for 18.5% of exports in kind, Iran for 15.7%, and the United Arab Emirates for 6.4%, together making up only 40.6% of total flows. The remaining 59.4% was distributed among a wide range of smaller markets.

Structure of product's exports in kind by countries, 2017-2020

World map of product's exports from India in kind, 2017-2020

Exports in value, M $ US

In 2020, tea exports from India totaled 692.1 M $ US, down by 15.0% from the previous year. Between 2017 and 2020, exports decreased by 9.9%, equating to an annualized decline of 3.4%. The maximum value was recorded in 2019 at 813.7 M $ US, which also experienced the largest annual increase of 6.2%.

Annual dynamics of product's exports from India in value, 2017-2020, M $ US

Over the 2017-2020 period, the geographical structure of exports in value terms was highly diversified. Iran represented 19.5% of exports in value terms, Russia 13.9%, and the United States 6.9%, together accounting for only 40.4% of total flows. The remaining 59.6% was spread across numerous smaller partner countries.

Structure of product's exports in value by countries, 2017-2020

World map of product's exports from India in value, 2017-2020

Imports tea to India

Imports in kind, K t

The market showed an unstable trend throughout the timeframe. Import volumes reached their lowest point in 2018 at 12.2 K t and peaked in 2020 at 33.2 K t, representing a 2.7-fold increase between these years. In 2020, cross-border shipments of tea to India came to 33.2 K t, indicating a sharp rise of 58.4% from the previous year. The largest decline was recorded in 2018 at 33.9%, while the largest increase occurred in 2019 at 71.8%.

Annual dynamics of product's imports to India in kind, 2017-2020, K t

From 2017 to 2020, Nepal, Kenya, and Vietnam were the main sources for imports in kind. Nepal accounted for 31.1% of imports in kind, Kenya for 22.5%, and Vietnam for 9.5%, together representing 63.1% of total flows.

Structure of product's imports in kind by countries, 2017-2020

World map of product's imports to India in kind, 2017-2020

Imports in value, M $ US

Volatility characterized the market behavior during these years. Import values hit their lowest point in 2018 at 27.5 M $ US and reached their peak in 2020 at 67.4 M $ US, showing a 2.5-fold fluctuation. In 2020, tea imports to India amounted to 67.4 M $ US, marking a gain of 22.4% relative to the prior year. The largest decline was recorded in 2018 at 30.2%, while the largest increase occurred in 2019 at 100.4%.

Annual dynamics of product's imports to India in value, 2017-2020, M $ US

In the 2017-2020 period, Nepal, Kenya, and Sri Lanka formed the main group of destinations for imports in value terms of tea to India. Nepal accounted for 30.6% of imports in value terms, Kenya for 24.0%, and Sri Lanka for 14.0%, with a combined share of 68.6% of total flows.

Structure of product's imports in value by countries, 2017-2020

World map of product's imports to India in value, 2017-2020