Global Tea Market - Positive Long-Term Growth Outlook 2020

Global Tea Market: Snapshot

Recent studies suggest that the high antioxidants content of tea provides myriad health benefits, which is benefitting the global tea market to a high degree. The consumption of tea is not only preventive for a number of diseases such as reduce the risk of heart diseases and help control blood pressure but also finds use in the treatment of cancer and improving bone density. Research suggests that the presence of polyphenols in tea impedes certain mechanisms that fosters cancer growth.

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Tea is rich in myricetin, flavonoids quercetin, and kaempferol thus its high dietary intake reduces the risk of fatal heart attacks. As per recent findings published in the journal ‘Circulation’, the consumption of more than two cups of tea per day reduces the risk of death caused by heart attack by 44%. The consumption of black tea also helps to build immunity against flu, thus individuals who gargle with black tea or consume it regularly have a high immunity against flu virus.

The low price factor and easy availability of tea has been the major factor for its high consumption after water across the world. The immense employment opportunities provided by the tea industry along with the growing adoption of green tea in skin care and beauty products is also propelling the growth of the global tea market.

The global tea market is expected to display a CAGR of 2.80% between 2014 and 2020 for the market’s valuation to increase from US$38.84 bn in 2013 to US$47.20 bn by 2020.

Large Quantity Exports and Economic Growth Benefits Asia Pacific Tea Market

Asia Pacific led the global tea market in 2013 and is expected to retain its dominance until 2020. This is because the highest revenue in the tea market is generated in Asia Pacific owing to the large quantity of tea exported from India, China, and Sri Lanka across the world. The increasing economic growth in this region has also been conducive to the growth of the tea market. Moreover, the increasing disposable income along with cultural practice of serving tea in countries such as India has been benefitting the Asia Pacific tea market.

At present, the North America tea market is relatively smaller compared to other regional markets, however, it is anticipated to display witness growth until the end of the forecast period in 2020. Major tea markets such as China, India, the U.S., Germany, the U.K., and Brazil are expected to display robust demand in the coming years.

Green Tea Product Segment to Display Robust Growth in Global Tea Market

The global tea market is divided on the basis of product type into CTC tea and leaf tea. The sub-segments of leaf tea are black tea, green tea, and oolong tea. In 2013, black tea held the largest share in the global tea market followed by green tea and oolong tea. However, the green tea segment is expected to register stronger sales in the coming years owing to the increasing awareness about the health benefits obtained from consuming green tea.

The presence of strong distribution channels is also a significant factor aiding the growth of the tea market. This includes the significant number of major distribution channels such as hypermarkets/supermarkets, general merchandisers, mom and pop stores, retailers, grocers, convenience stores, and food and drinks specialty stores in both rural and urban areas. Supermarkets and convenience stores have emerged as popular channels for the sale of consumer goods due to the economic growth leading to rising living standards in developing countries. Supermarkets and hypermarkets are expected to be the leading distribution channels in the coming years.

Some of the leading players operating in the global tea market are Twinning of London, Unilever, Akbar Brothers Ltd., Wissotzky Tea, and Tata Global Beverages.