India is the second-largest producer of tea globally. Indian tea is one of the finest in the world owing to strong geographical indications, heavy investment in tea processing units, continuous innovation, augmented product mix, and strategic market expansion. As of 2022, a total of 6.19 lakh hectares of area was cultivated in India for tea production. India is also among the world's top tea-consuming countries, with 80% of the tea produced in the country consumed by the domestic population. In 2022-23, India’s tea production stood at 1,374.97 million kgs, compared to 1,344.40 million kg in 2021-22.

The Assam Valley and Cachar are the two tea-producing regions in Assam. In West Bengal, Dooars, Terai and Darjeeling are the three major tea producer regions. The southern part of India produces about 17% of the country's total production with the major producing states being Tamil Nadu, Kerala, and Karnataka.

India's total tea exports during 2022-23 in quantity were 228.40 million kg and worth US$ 793.78 million. During the financial year 2021-22 period, India exported tea in quantity were 200.79 million kg worth US$ 726.82 million. In 2022-23, the unit price of tea was US$ 3.48 per kg. From April 2023-January 2024, quantity of India’s total tea exports stood at 199.84 million kg.

Global tea market experiencing unprecedented growth

According to a latest update from Maximize Market Research, the global tea market is experiencing unprecedented growth, with its value soaring from $75.93 billion in 2023 to an anticipated $118.77 billion by 2030, reflecting a compound annual growth rate (CAGR) of 6.6%. This surge is driven by the increasing popularity of tea as a health-conscious beverage and the introduction of innovative flavors and varieties. The market is divided into three segments based on the applications: online, specialty stores, supermarkets and hypermarkets.

Over the course of the forecast period, the online distribution channel segment is anticipated to grow quickly at a CAGR of 5.9%. The introduction of online apps, coupled with the availability of sales and prompt product delivery, has a positive effect on the supply chain of the market. For instance, stores like Big Basket and Walmart, among others, provide a wide range of flavored teas with the option for both online and offline delivery. Throughout the forecast period, these are the main factors propelling this segment's expansion in the worldwide market.

Outlook:

Falling domestic Tea output could keep prices supported. The export trends also need to be checked. According to Tea Board data, the total exports of Tea from India stood at 43.40 mkg in January-February 2024, up 32% on year. Export earnings stood at Rs 1054 crore, recording a surge of around 15% despite a drop in per unit value. Media reports have stated that Iran has stopped importing Indian tea and rice in a likely retaliation for India curbing some fruits from Iran. This can curb some export demand.