Tea market in Nepal

Earlier Report Observations

Nepal's tea market volume grew from 90.7 thousand tons in 2018 to 115.7 thousand tons in 2023. This expansion was supported by government policies aimed at promoting investment in the tea industry and a shifting consumer preference towards organic and higher-quality tea products, which increased domestic consumption. Production rose from 108.0 thousand tons to 129.2 thousand tons over the same period, reflecting these demand-side drivers and gradual infrastructure improvements.

The industry's growth faced headwinds from traditional farming methods, a lack of modern technology, and limited storage infrastructure in rural areas, which constrained productivity gains. External factors, including global supply chain disruptions and policy complexities with India, periodically affected export volumes, but the domestic market's absorption capacity helped maintain overall market growth.

By 2023, the market continued its upward trajectory without significant new disruptions, reaching a production high of 129.2 thousand tons. The consistent increase in market size underscores the role of sustained domestic demand and ongoing, albeit incremental, enhancements in market management and storage facilities.

Production tea in Nepal

In kind, 2017-2020, K t

From 2017 to 2020, Nepal ranked 16th globally in tea production.

Top producers of tea, 2017-2020

World map of production of tea, 2017-2020

Nepal's tea production volume grew for the third consecutive year. In 2020, the country produced 119.6 K t of tea, an increase of 8.7% compared to the previous year. Over the period from 2017 to 2020, production rose by 11.8%, with a compound annual growth rate of 3.8%.

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

In value, 2017-2020, M $ US

Tea production in Nepal increased for the second consecutive year. In 2020, the output was valued at 293.2 M $ US, marking a robust rise of 20.2% from the prior year. Between 2017 and 2020, production grew by 26.8%, equating to an annualized rate of 8.2%. The lowest value was recorded in 2018 at 191.8 M $ US. The largest decline occurred in 2018, at 17.0%, while the largest increase was in 2019, at 27.1%.

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

Exports tea from Nepal

Exports in kind, t

In 2020, Nepal's tea export volume reached 13 499 t, reflecting a 26.6% year-over-year rise. Between 2017 and 2020, exports increased by 4.3%, with an annualized rate of 1.4%. The lowest volume was recorded in 2019 at 10 660 t, while the highest was in 2018 at 17 695 t. The largest decline occurred in 2019, at 39.8%, and the largest increase was in 2018, at 36.7%.

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

Throughout 2017 to 2020, India remained the almost exclusive buyer of tea from Nepal, accounting for 96.5% of total exports in volume.

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

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

Exports in value, K $ US

Nepal exported 33 088 K $ US of tea in 2020, indicating an abrupt rise of 40.0% year-over-year. Over the period from 2017 to 2020, exports increased by 18.4%, with a compound annual growth rate of 5.8%. The lowest value was recorded in 2019 at 23 626 K $ US, and the largest decline occurred in that same year, at 24.8%.

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

From 2017 to 2020, India remained the main outlet for tea from Nepal, taking 89.5% of total exports in value, while the remaining volume was distributed among other countries.

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

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

Imports tea to Nepal

Imports in kind, t

Tea shipments to Nepal from abroad declined for the second consecutive year. In 2020, imports stood at 243 t, constituting a notable decline of 21.1% over the past year. Between 2017 and 2020, imports decreased by 33.7%, equating to an annualized rate of 12.8%. The highest volume was recorded in 2018 at 406 t. The largest decline occurred in 2019, at 24.3%, while the largest increase was in 2018, at 11.1%.

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

Over 2017 to 2020, India was the dominant supplier of tea to Nepal, accounting for 87.3% of total imports in volume, with other countries sharing the remaining portion.

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

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

Imports in value, K $ US

The volume of tea imports to Nepal declined for the second consecutive year. In 2020, import volume reached 928 K $ US, showing a small decrease of 1.2% over the past year. Between 2017 and 2020, imports decreased by 8.5%, equating to an annualized rate of 2.9%. The highest value was recorded in 2018 at 1 219 K $ US. The largest decline occurred in 2019, at 23.0%, while the largest increase was in 2018, at 20.3%.

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

In 2017 to 2020, the structure of imports in value terms was marked by the predominance of India, which absorbed 87.3% of total flows, and by a large number of minor partners.

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

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