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World tea situation in brief.

World tea situation in brief

Global tea production in 1990 was a record 2.56 million tons, over 3% greater than a year earlier, and above the previous all-time high of 2.48 million tons in 1988. The bumper 1990 crop was mainly the result of record harvests in India, Sri Lanka, and Kenya. However, China's crop was down for the second consecutive year in response to poor market conditions and production continues at low levels in the Soviet Union, reflecting the adverse effects of the 1986 Chernobyl nuclear plant accident. Because of the shortfall in domestic production, the Soviet Union has had to increase imports to meet consumption needs. Soviet tea imports in 1989 were a record 214,878 tons, making it the world's largest importer, displacing the United Kingdom which had held this position over the years. However, Soviet imports were curtailed in 1990 by a severe shortage of foreign exchange, and have been largely limited to bilateral trade deals with India. Imports by the United Kingdom and the United States also were lower in 1990.

World tea production and consumption continues to remain in close balance, with supplies running slightly ahead of demand. However, large quantities of low-quality teas on the market has kept prices low. London auction prices for all teas in 1990 averaged 92.2 cents per pound, slightly above year-earlier prices of 91.2 cents, but were well above the depressed 1987 level. After exibiting a firmer tone in January, prices have been trending downward in early 1991, averaging 93.7 cents during the January-March quarter.

Tea consumption in many nations is facing strong competition from soft drinks, fruit juices, coffee, and alcoholic beverages. In the United States, about 80% of consumption is as iced tea, whereas tea is drunk as a hot beverage in most other consuming nations. Although India remains the world's largest tea producer and consumer; on a per capita basis Ireland is No. 1 with a rate of 3.1 kgs, closely followed by the United Kingdom with a 2.8 kg rate. Before the Persian Gulf conflict, Iran was a significant consumer with a per capita rate of 2.9 kgs. India's per capita consumption is only 0.6 kgs, while the United States is about 0.35 kgs.

The Eighth Session of the Inter-Governmental Group on Tea, under auspices of the Food and Agricultural Organization of the United Nations (FAO), was held in Rome October 1-19, 1990 to review the world tea economy and to make recommendations for intergovernment action to improve producer earnings. Efforts continued to focus on generic tea promotion programs and on minimum export standards to improve tea quality.

Major Importers

USSR tea imports in 1990 were believed to have fallen from the record level of the preceding year because of a shortage of foreign exchange to make purchases. Domestic production of tea still remains at low levels as a result of the adverse effects of the 1986 Chernobyl accident, which resulted in contamination of some of the tea producing areas. India remains the largest supplier to the Soviet market, but purchases from China, Indonesia, Turkey, and Kenya have increased in recent years. Soviet tea exports have fallen sharply since 1985, averaging only 4,880 tons during 1986-89, compared with shipments averaging 21,580 tons during 1981-85. Since-1985, exports have been limited mostly to Mongolia.

United Kingdom tea imports in 1990 dropped nearly 8% from a year earlier, largely reflecting smaller shipments from India and Malawi. Re-exports of tea, however, were up over 22% to 36,035 tons. Competition from other beverages and the increased use of tea bags, which are more efficient than using loose teas, has contributed to declining consumption.

London tea stocks on December 31, 1990, in public and private warehouses (excluding primary wholesalers) were 37,383 tons, down slightly from a year earlier levels of 38,947 tons. Stocks held by primary wholesalers for the same period were 11,020 and 12,472 tons, respectively.

Kenya continues as the largest supplier to the U.K. market in 1990 with shipments of 83,367 tons, or nearly half of the total, followed by India with 24,326 tons and Malawi with 18,244 tons. Imports from Sri Lanka were virtually unchanged from a year earlier at 11,497 tons.
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Title Annotation:production and consumption of tea world wide, 1990
Publication:Tea & Coffee Trade Journal
Date:Sep 1, 1991
Previous Article:The Perfect Cup.
Next Article:India: political upheaval doesn't aid industry.

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