The Changing Face of Indian Tea
Story & Photographs by Bruce Richards


The face of Indian tea is slowly evolving as new challenges and opportunities open to this 150-year-old industry that is so vital to the nation's economy. Only Sri Lanka, Kenya and China export more tonnage each year. The Tea Board of India and many individual gardens are searching for ways to meet the changing demands of our global marketplace. Total tea production in India during the 2003 growing season was 857 million kilograms (one kilogram equals 2.2 pounds), with exports on the decline, due mainly to a sharp drop in sales to Iraq.
   The reopening of the Iraqi market, coupled with loosening import restrictions in Iran, indicates that exports should grow in the near future. Industry analysts across India predict higher tea prices throughout 2005. What changes are taking place to ensure the viability of Indian tea in the world market?
   The Tea Board of India recently hosted a trade mission with 11 Specialty Tea Institute members from the United States. While in India, the STI delegation toured tea gardens in Darjeeling and Assam, visited an auction house and spoke with leading tea industry and government officials. The following report highlights some emerging trends.

Bio-Dynamic Farming
The renowned gardens of Darjeeling produce teas with a distinguishable muscatel flavor and aroma. Grown on steep mountain slopes at elevations of 1500 to 7000 feet above sea level, these delicate teas command some of the world's highest auction prices. Many of the factories and pieces of equipment have been in use for nearly a century, and change is slow to come to this far corner of the world. Competition from other tea producing countries now is prodding owners to lure new audiences by investing in both new technologies and ancient practices.
   The future face of Darjeeling tea may well be found at the Ambootia Tea Estate in the foothills of the Himalayas. This is one of two premier bio-dynamic farming operations. Using a holistic approach, farming is seen as the interdependent development of minerals, plants, animals and positive cosmic forces that allow nature to bring agriculture to life. These agricultural practices not only produce beautiful teas, their story makes a great marketing device for western consumers eager to replenish the earth.
   This revitalized estate is now a self-contained, closed system in which all inputs are generated from the farm ecosystem. Fertilizers are created from organic materials contributed by plants and animals residing within the system. The fertilizing methods are enhanced by the application of preparations made from yarrow, valerian, chamomile and other herbs. About 340 cows within the farm provide the compost necessary to stimulate soil life, as well as milk for the 4500 people who live there. Even the cattle horns are recycled as decomposable containers for the organic fertilizer buried in the fields.
   The rhythm of the plants is considered, studying their reaction to climatic changes, seasonal effects and even the impact of the lunar cycle. These studies reveal the most appropriate timing for the application of organic inputs, so as to maximize intended benefit. All activities are aligned to create an ecosystem in harmony with the cosmos.
   The most important factors in maintaining organic and bio-dynamic farms are the social and ecological responsibilities the owners have. According to estate manager Mr. S. Mukherjee, "The uncompromising welfare of the family units on the farm is the single biggest priority. Most people have been living here for generations dating back to 1861. They are provided housing, sufficient water and energy for their daily needs, medical care and subsidized food, besides wages. Children are not employed and it is mandatory they attend the schools provided on the farm, providing an opportunity to educate themselves."
   Mr. Mukherjee was pleased to share one of the additional benefits of bio-dynamic farming: "The birds and butterflies have returned in great numbers to the gardens."

Worker Relations
Headquartered in the former Soviet consulate building in Calcutta, Tata Tea is the world's second largest global branded tea business, and parent company to Tetley. It is owned by the largest corporation in India, Tata Business Group. From hotels to truck manufacturing, this driving force in the Indian economy produced 5 percent of all Indian exports in 2003. With an area of 26,500 hectares (one hectare equals 2.47 acres) under tea cultivation on 51 estates, Tata Tea produces around 60 million kilograms of black tea and 2 million kilograms of instant tea annually. They control just over 4 percent of the world's tea market. Only Unilever, parent company of Lipton, is larger.
   Both Tata and Unilever rely heavily on the 800 gardens of Assam to supply the demands of their ready-to-drink and instant tea customers. They traditionally have had great success, both domestically and internationally, in blending and marketing store brands that cater to local tastes. But recently the Assam region has been facing a crisis, with prices dropping in weekly auctions, export figures slumping and domestic consumption also on the slide. Assam's best quality tea currently is priced 10 percent lower than five years ago. The slump has led to the closure of 20 tea estates and has left thousands of workers jobless. This has led to civil unrest and many estate managers now have round-the-clock guards to guarantee their safety.
   Tata Tea has made a commitment to subsidize medical care for over 27,000 non-employees in many North Indian estates. Additionally, more than 34,000 villagers were treated free of charge in 224 health camps organized by the company during 2003. Over 2500 women were given prenatal care. Unemployment, a longtime problem in these remote areas, is being addressed with the establishment of training centers providing education and skills management in computer operations and mechanical repair.

Tea Auctions
Most Indian tea is sold through four regional auction centers. The Guwahati Tea Auction Centre (GTAC) handles mainly Assam teas. There are at present 665 sellers, 247 buyers, 9 brokers and 34 warehouses registered with the GTAC, making it the third largest tea auction house in the world.
   Auctions are held on Tuesdays and Wednesdays throughout the year. On the day of auction, the brokers and buyers meet in the auction hall of the GTAC. Brokers are given set timings to offer the lots in their catalogues. The auctioneer opens the sale by calling for bids from the buyers who, weeks ago, were supplied with samples and the broker's valuation for each lot on offer. Buyers make initial bids to test the auctioneer on how low a bid will be acceptable. Bidding sometimes becomes quite spirited as buyers split invoices and make quick deals on the floor as the sales progress.
   The auctioneer knocks down a lot and announces the name of the buyer along with the highest price received for the lot. Once a consignment has been knocked down it cannot be reopened. The highest bidder must accept the entire lot.
   This age-old trading system is now entering, somewhat reluctantly, the electronic age. In 2004, half the auction hall was outfitted with computer monitors for electronic auctions. These sales are held in the afternoons after the traditional auction. A dozen or so invoices are projected onto the buyers' screens and they have four minutes to place their bids. Like eBay, the competition can get quite spirited as the time limit approaches. Secretary Jayanta Kakati sees this as the future of tea trading. "There will come a day when buyers around the world will sit in front of their computers and bid on our teas here in Assam," he said. "The tea industry must be forward-thinking in order to survive."
   The auction system itself is fighting for survival. With the advent of e-mail and overnight delivery, many estates are bypassing the auction system in order to sell directly to retailers around the world. Tea growers or their representatives are actively soliciting new American buyers at the Specialty Coffee Association of America (SCAA), Fancy Food Shows or at Take Me 2 Tea Expos. The proliferation of small tea blenders has given these estates an opportunity to supply the growing demand for single-estate teas in the United States. Samples can be delivered quickly and prices can be negotiated over the phone or Internet. A chest of tea from Darjeeling can make its way to a supplier in the United States within five days via air, or a month by sea container. At least one Assam garden now has a Miami warehouse to ease transportation costs and allow quicker fulfillment of orders. The auction house and broker are eliminated and the seller keeps more of the profit. The buyer may get a lower price and the opportunity to offer a single-estate tea that is somewhat unique in the tea marketplace.
   While this may seem a logical way to protect the future of small growers, Secretary Kakati says it hurts the industry in the long run. He also believes, "There is no way to track the amount of tea that bypasses supervision of the auction system. What recourse does a buyer have if he is not pleased with the product he receives?"
   Yet this fast-growing trend is likely to continue unless the Tea Board of India decides to intervene.

Specialty Tea Production
India has been best-known for outstanding traditional black teas. First and Second Flush Darjeelings, malty Assams, and rich Nilgiris have been the mainstay of most blenders' catalogs. Competition with the neighboring Chinese market has led to growing sales of green, oolong and even white teas stamped with the familiar "Produce of India." This trend has quickened over the past five years as many factories re-tool and produce green teas during the monsoon season or create custom-order oolongs for large buyers. It is not unusual to find silver tips or gunpowder listed in a Darjeeling estate's list of invoices.
   Assam growers can look forward to increasing sales by marketing their high end "tippy" teas. Designed more for the American and Japanese market, these versatile teas have a beautiful appearance and can be enjoyed with or without the addition of milk. Prices for these gourmet teas will increase as demand spreads. This should help the bottom line of the estate owners.
   The growing interest in premium teas has not been overlooked by The Tea Board of India. The Tea Board is not involved in manufacturing any product and operates on a nonprofit basis. It exists to improve the quality of Indian tea and to market Indian tea at home and abroad. All teas produced in these areas are administered by the Tea Board under the Tea Act of 1953. They recently launched an aggressive advertising campaign to protect teas coming from the three main tea growing regions of Darjeeling, Assam and Nilgiri. Each area has a distinctive logo guaranteeing the tea's origin. This helps deter foreign teas being sold with counterfeit Indian pedigrees.
   India's spectacular teas are certainly legendary. Anyone who visits these gardens comes away enchanted by the scent of camellias and overwhelmed by the powerful beauty of this ancient landscape. Those in the Indian tea industry realize they cannot rest on reputation alone in the competitive world tea market. They must adapt to changing tastes and economic conditions. With a renewed commitment to quality teas, respect for the land, improved worker relations and the implementation of new technologies, the face of Indian tea will stay fresh for years to come.