India sees high-quality tea exports booming

India, the world's largest tea producer, expects production and exports of premium quality orthodox tea to grow with fresh demand from Iran and Russia, a senior industry official said on Thursday.
"The real potential for exports is in orthodox tea," Moonlit Dasgupta, secretary general of a leading producer's body, the Indian Tea Association (ITA), told Reuters in an interview.
"Iran has lifted its ban on tea imports and Russia is going back to orthodox." India is expected to produce around 830 million-kg of tea in 2004, down from 857 million kg in the previous year because of poor climatic conditions in northern India.
Orthodox tea accounts for around 80 million kg of total production. India is likely to export around 190-195 million-kg in 2004, up from 173 million kg a year ago, he said. "The break-up of orthodox and CTC exports is not available."
Exports are expected to rise as demand from Russia, a leading tea importer, is fast shifting back to orthodox tea from cheaper curl, tear and crush variety (CTC), he said. Orthodox tea, in long leaf form, is made from good quality leaves and is milder in taste but has a better aroma.
CTC tea, in granule form, has a strong taste and is dark in colour. It is largely consumed in the domestic market. Orthodox produces almost half the number of cups of tea compared with CTC and caters to a niche market.
Russia buys around 160 million-kg of tea a year, of which 60 percent is orthodox and the rest CTC. India sells around 44 million-kg of tea to Russia. Sri Lanka, China, Indonesia, Kenya and Vietnam are among India's major competitors in the global market.
Iran, which lifted restrictions on tea imports a few months ago, mainly buys orthodox tea. "We see a demand of 40 to 50 million kg of orthodox tea every year from Iran," another ITA official said.
"If planned properly, we could end up producing more orthodox tea from the north-eastern region by next year," Dasgupta said. "We could do more exports in 2005 provided we are clear about our production strategy for orthodox tea."
The northeastern states led by Assume account for 75 percent of the country's tea production and the rest comes from southern India. India's exports fell in 2003 from a year, largely due to troubles in the vital Iraqi market after the US-led war.
Exports to Iraq plunged 71 percent to 12.7 million kg in 2003. "Sales to Iraq are growing but it is still a risk-laden market," Dasgupta said.