24 May 2022, Rome: As the world celebrates the International Tea Day 2022, the Food and Agriculture Organization of the United Nations (FAO) has highlighted the need for greater economic, social and environmental sustainability in the tea sector and its key role in empowering women and youth for improved food security and nutrition.
“The tea sector contributes to socio-economic development, representing a major source of employment and income for millions of poor families, yet it faces a number of challenges,” FAO Director-General QU Dongyu said in an address for the celebration. He said the tea sector “needs to achieve greater sustainability, from tea leaf to cup.”
“Environmental sustainability involves the use of innovation and production methods that preserve resources for the future.” Sustainability also “needs to capture the social side of the sector, by empowering women and youth and ensuring that production throughout the value chain is respectful of social norms and standards,” the Director-General added.
During the COVID-19 pandemic, the demand for tea saw a strong increase, spurred by purchases for in-home consumption. Market information collected by the FAO Intergovernmental Group on Tea (IGG/Tea) showed that tea consumption expanded in all markets, even those that recorded a declining trend in per capita consumption over recent years.
The data showed a surge in the demand for tea among young people. The surveys highlighted that young people rediscovered their love for tea during the lockdown due to the hydration benefits and the “feel good” factor.
FAO has underlined that the tea sector can play an important role in improving lives and restoring the livelihoods of millions who have been impacted by the successive shocks of the past two years. Global tea production amounts to over $17 billion annually, while world tea trade is estimated at about $9.5 billion, accounting for an important source of export earnings. Tea generates productive jobs and empowers individuals, especially women and their communities.
Price level and volatility another challenge
But in addition to sustainability, the sector also faces the challenge of market price levels and volatility. International tea prices, in real terms (adjusted for inflation), have been declining for the past four decades, as production increased faster than demand.
“Actions are also required to tackle some of the issues impacting smallholders, who account for 60 percent of global tea production,” Qu said.
FAO stresses that if small-scale tea farm operations are to remain viable in an increasingly competitive market environment, they need to constantly innovate. Marketing options that have been explored, particularly by the FAO IGG/Tea, include raising the value of tea products through standards, specialty teas, product innovation and generic promotion. The tea sector must demonstrate its value in order to command higher prices.
Tea cultivation is attractive to smallholders in many low-income countries because it creates jobs and income throughout the year and requires relatively little investment, while the risk of crop failure is generally small. However, the issues impacting smallholders include low farmgate prices, poor extension services, limited market channels, and poor access to credit and technology. There is a pressing need to strengthen the smallholders’ business ecosystems. Tea smallholder growers can suffer the most if not well protected, the IGG has warned.
Qu said, “We need to do things differently, embrace new and innovative approaches and move to action” in order for the tea sector to succeed in balancing the need for growth and the requirements of sustainability at all stages of the value chain.
FAO’s work on tea
FAO’s work on tea is committed to achieving a sustainable tea sector. Our activities include the development of knowledge products and the provision of data and information on tea markets and trade, medium-term projections for the world tea market and policy relevant information on the sector.
The FAO Intergovernmental Group on Tea, one of FAO’s oldest commodity groups and a subsidiary body of the Committee on Commodity Problems (CCP), leads the multilateral actions in all aspects related to the world tea sector. These include coordination efforts for the harmonization of standards, guiding the generic promotion of tea and the development of tea strategies for climate change adaptation and mitigation. You can find out more on FAO’s work on tea here.