Tea Biz
Tea Biz

Episode · 4 months ago

Tea News and Biz Insight - August 6, 2021

ABOUT THIS EPISODE

HEAR THE HEADLINES – India Tea Auction Mandate Chafes Producers | Smallholders Seek Higher Raw Leaf Minimums
| Sharetea Ranks 6th Among Fastest Growing US Retail Chains

| GUEST – Narendranath Dharmaraj, consultant and former plantation manager with Brooke Bond, Unilever, and Harrisons Malayalam

| NEWSMAKER – Shabnam Weber, president Tea & Hearbal Association of Canada

| FEATURES – Tea Biz this week travels to India for an historical perspective on the Tea Board’s recent decision to enforce a controversial mandate that registered gardens sell at least half of the tea they produce at auction… and then to Toronto, Canada where Tea Biz continues its coverage on differentiating specialty tea with Shabnam Weber president of the Tea & Herbal Association of Canada and a spokesperson for the Tea Association of the USA and Tea and Herbal Infusions Europe. Shabnam says that as an industry, “we should together be working on elevating the value of tea for the betterment of every part of the supply chain.”

Tea Auction Mandate

The Tea Board of India recently issued a circular mandating that 50% of the production from a garden must be sold via auctions. We ask Narendranath Dharmaraj, a veteran in the tea industry about his views on this, and what it means to the industry.

Is Tea Divisible?

Joining us today is Shabnam Weber, president of the Tea & Herbal Association of Canada. In 2000 she co-founded the Tea Emporium, a chain of Canadian specialty tea shops. She served as a member the THAC board for many years before selling her company to lead the association. In this conversation she represents not only the Canadian tea industry, she is also spokesperson for the Tea Association of the USA and Tea and Herbal Infusions Europe, an apex group that in turn represents tea associations in Ireland, the UK, Germany, Spain, France, Austria, The Netherlands and several other European countries.

For the TAP is podcast delivers t news thatyou need to know a recap of the week's major headlines with commentary andcultural trends hosted by Dan Bolt. It is the voice of origin for tprofessionals and enthusiast road by think of us as a digital caravan ofstory, tellers, bringing authentic, authoritative and exclusive stories toyou, weekly from the tea lamp, hello, everyone who are this weekheadlines, Indian Tochanan de Chiefs, producers, small holders seek higherraw leaf minimums and Sher te ranks among the fastest rowing US retailchains more in a minute. But first this important message: What makes a Perfect Cup of Ceylon tea?The Perfect Cup is from the T, businesses that ensure the protectionof all the children living within their tea estates. We Salute Kalani Valley, tell a Wakely,Bogo, Wanta, Lawa, Parana and Elipa t estates support, Save the ChildrenSrilankan Tea Rowers, currently getting goodprices in private sales. Strongly objected this week to an July fifteenthworter by the teaboard of India, calling for strict compliance with therequirements that to estates sell a minimum. Fifty per cent of their tea byvolume and regional auction houses, the mandate comes amid low auction pricesand a glut of mediocre tea. According to grillers quote it's a buyer's market,as they demand more customized and quality tea through private sales saidMick Lloyd, Russell Director as a modum. Large producers are already underpressure. Owing to the auction market crash high wages, we greet tail sailsand lock down and the drought. He said the order follows an audit showing thatmany registered gardens were sending far less than half of their produce topublic auctions. The announcement comes as t exports decline and labor costsincrease, also of knowed as the fact that to lower logistics costs agentsbidding on lots now represent many more buyers. The practice reduces the numberof bidders prices of the Siliguri auction fell. Eighteen per cent inearly July business in sight, sugit PatreSecretary of the Indian Tea Association explains that selling direct earnsgrowers, good prices and quick cash flow, which the present auction systemdoes not facilitate. Forcing growers to auction better quality teas does notoffer any protection against continuous declines and prices. He said later in the podcast Narendra d'armerieoffers an historical perspective on auction mandates. A steep decline in the price pade forgreen tea leaves threatens the livelihood of small tea growers thatproduce fifty one per cent of indios tea. Uncertainty has led many to sell theirgreen leaf for fifteen to seventeen rupees for kilo, a rate below the costof production. In a letter to India's Minister ofCommerce, the Confederation of Indian Small Tea Growers, Associations saidthat bought leaf factories are not complying with prising minimumsadjusted by region. The Confederation is seeking a twenty five rupee per CiloMinimum for small holders. In Response...

Tea Board, chairman prove Basra saidthat better prices are possible, but only if the green leaf mates requisitequality standards insisted upon by manufacturers, share t a Taiwan base. Milk fruit andbubble tea chain ranks. Sixth among the fastest growing O is food chains in twothousand and twenty. According to nations restaurant news, which use datessentials, firefly survey data to calculate rankings. The companyrecorded sixty four point: seven billion in domestic sales in the USmarket growing by twenty seven per cent. During the pandemic, there are onehundred and thirty one: U S. locations in Twenty states listed on the website. The chain which operates three hundredlocations world wide was founded in one toad. Nine hundred ninety two sher teareports that their best selling beverage is tiger milk, a combinationof Brown, sugar and Tapioca Pearls Business in sight. Many of the fastest growing chains arerelatively small, but each at the top twenty five grew at least fifteen percent. Last year, only two hundred and two of the five hundred largestrestaurants rank by nations. Restaurant News managed system wine growth in twothousand and twenty arvind, an and Terman and Bengalurureports on India's tea auction prices in diatetic report for the week end inJuly, thirty, first, two thousand and twenty one continuing the conversation from lastweek where the teaboard of India had issued a notice, insisting that fiftypercent of posit he produced be sold by our auctions. The peaks are producergroups, responding and raising concerns. One of the responses has come from theNorth East Enty Association, who said the price of green lap is a matterbetween glue and the manufacturer. The vose said that at the minimum price togreenly is fixed, so should the minimum price of made tep calling the currentminimum bench mark price faulties association has said that it's neitherhelping the growers not of manufacturers the associations. As forthat party study to make recommendations at we benefit theindustry in market sale. Thirty, the auctionssaw a higher volume of unsalt, especially in north India, Colcato GoodAmabuto, dox tyin far demand for city C Lef, while go hat, is so far a man forboth and go Hatita too big byes. In thistime, you really Bernd or to consumer products were active for dust in thesouth. could she saw decline and expose a scrap the rise in covet in Russia,along with sanctions in Iran, Orthodox? To only saw about fifty onepercent soul? Will thirty six percent of city c leaffor Sol cts dust, so better uptake as itty to send the teas on offer a son prices remain the same as previousspeak or slightly lower, and now a word from our sponsor to trade. Teas works with tea purveyorsat every scale, from promising start ups to the world's largestmultinational beverage brands in the hot ICED and bounty segments with USbased formulation, blending and packaging services. Hug Trade can help.You innovate scale up and grow. Your specialty t brant for more informationvisit. Our website and q trade. TESCO tibis this week travels to India for anhistorical perspective on the Tea Board's recent decision to enforce acontroversial mandate that registered gardens, sell at least half of the teathey produce at auction and then to Toronto. Canada, where tevis continuesits coverage on differentiating...

...specially tea with Shandon Weber,president of the Tian Herbal Association of Canada, and aspokesperson for the Tea Association of the USA and tea in herbal infusionEurope. Shedda says that, as an industry quote, we should together beworking on elevating the value of tea for the betterment of every part of thesupply train. The Tea Board of India recently issueda circular mandating that fifty per cent of the production from a gardenmust be sold by our auctions. We asked Nareda Tamarac a veteran, thetea industry, about his views in this and what it means to the industry. The Tea Board of India recently issueda circular mandating that fifty per cent of the production from a gardenmust be sold by our options. We asked Merinda Tamarac a veteran, the tendustery about his views on this and what it means to the industry. To giveyou you a little historic perspective, this all started some time early sthrough the introduction of what is called the team marketing control order.We, the government Vita TC more popularly noots, which generallystipulated seventy person mandate action. Then they made it into seventyfive percent that was about the time and x sport control. Honor was alsointroduced. That was the also the time and keep rises were ruling high. As amatter of fact, the at some point, I think it was eight three and eightyfour there was a ban on exports for video, which literally almost put anail in the in the India export scenario. In the beginning of a twotousand, we lost the following. The distant degrade US sore oster capitalmarket to was introduced. Asan CAVENSA under belly of the industry music pose.So we were sort of re examining every aspect of the business and one of thethings. Of course we did as a drawer association publicaty was to lobby against this. Seventy five person mantedreaction auctions. We did. We had to do a lot of work on that. You know, expose the huge gap between the fanadprize and the the the redact and then finally, we managed to get thegonvenient to reveal that seventy five percent manatee auctions- and we also and the time, studied the auction rules in detail,and we were convinced that there were basic issues in the Bo, the theprinciple and processes of the iota which is not leading to correct price,his care or looking at the data. Since two thousand and fourteen thepercentage drop in volume of auction Sayers is not new, so by insisting onthis will there be any advantages to the TE NUSRY? The thinking seems to bethe lack of Francard in the private sales and therefore the small growersare Inie, a fair price. I think that seems to be the the spirit behind it.Nothing wrong with that spirit, very horrible, but you know we seem to be coming upwith the solution, which is worse than the remedy. Weston the diseases inmandating Cobley auction sales, because you know the the are the Dar production,save everything is being monitored and tracked by the t board. There arehundreds of returns to be submitted and as well. That is not enough. Now, thewith interaction to the G St. there is...

...obviously a lot of transparence so whyprivate sale pricing cannot be tracked. I am unable to understand so now going back to thetherelay action Prince Person Process assised. We do believe that is notlending to correct price discovery. Given a supply and demand situation. Theauctions started even when they, before the introduction of the Forum ExchangeRegulation, act, the Faman, the FERA etc. So at that time the producers werethe SOTHA sterling companies. The buyers were the distempering companies.The brokers were stelling companies, so as more transaction arrangement than ascientific price discovery Kandis. So to that extent it was flawed andheavily bier in favor Le is the buyers. Even after the the English left, everything was indenied a et business practically when did do that and of the Indianbusiness poses it by, as obviously he didn't want to change this systembecause it was favorable to them is a producer. Unfortunately, the under topin the hole and you change, he has the mouth of the cost. What is a personpage of cost of the producer in the ultimate in consumer price? There isobviously a big mismatch between potises Peralta Post share versusPestana value share. What was this proxy buying said? One buyer put by on?We have a very number of byes so which literally killed competition to eventhe option. Of course, you can argue that there is no proxy buying, but youknow it's our password managed as we or so the far there's. Nothing preventsanybody from sort of sharing the password to the other. So it is despitethe option that that issue of proxy buying, to my mind, has not beendissolved. After the option came, they said there'll be fan in the optionsthat the you know, the the restricted saying Gography won't be there, butit's not happening for whatever reason which in sale that I operate. Theperson by as telamonius except e Fanian option not happen. I only if thathappens, then they then the conversation will go off. They'll bemore more play is work and the other problem in the the principle was whatis called the division of lots. The the auction allows fora bias to divide thelots between them. I have studied just a lea time. After time we could findthat even the biggest buyer in the country were sharing lots with thesmallest virus. It seems so so irrational and fair. I think I'm toldthat that division of lots continues even now, which is again.Andy Competition, in fact, are undher recommendation of virgus. At that pointto time was they introduced what is called a divisibility premium? Anybodywho buys on my do, I did more as to pay a five person pregame on on price,which of course was stoutly opposed by the the Bier Combuti that has beforethe e often came in is the auction system stillrelevant today. Have auctions made a difference? Myanswer is the big Eno to because...

...there's an option in cope in optionrobber Romer in fact claims they have the highest form gate price for anycommodity, O a price or commensurate with the with the suppliant of Cos. The descries are sinit arrived at by theforces of market independent of any rules that the word let the dependent free tradein MECANISME, fine price. We are saying what is the way to reach that price gotin the way to discover that price. He action as they said it is an improvement, no doubt, but some of these issues are still notgetting a resolved. The props, this Davison of lots withlast minute crowding these are not being addressed even the the auction and not for a moment sayinghe. The buyers are versine, they are serving their business objective. Afront Tis, as the producer wants to produce at the Louse Poston, send a thehighest price. The war would want to buy at the lowestprice latly. So you know- and I is there is a system that allows that thatseems to be the they concerned. In my opinion, for the producers joining us today is Shabnam Weber,president at the Pianura Association of Canada, in two thousand, she cofoundedthe tea, emporium and chain of Canadian specially tea shops. She served as amember of the THA C board for many years before selling her company tolead the Association. In this conversation she represents not onlythe Canadian tea industry. She has also a spokesperson for the Tea Associationof the USA and tea in herbal infusions, Europe, an apex group that in turnrepresents two associations in Ireland, the UK, Germany, Spain, France, Austria,the Netherlands and several other European countries can speciality to be defined or hisequality best viewed as a continual trying to find a definition for cheese,like kind of nail, yellow to a wall, and that's not my quote: I'm I'mquoting Bill Clinton Er and if we all accept that to be an absolute truthwhich we seem to be agreeing on, then why are we putting our energy andtrying to differentiate and what appears to be dividing up the industryinto good and bad? Our objective as an industry should beworking together in order to capture share offs throat from coffee, fromwater and from soft drinks. That should be our objective. So let's pretend thatin some magical world we actually managed to find a differentdefinition that everybody agrees on my question is so what and then what? What's going tohappen? Have we actually converted a single coffee drinker over to tea? Havewe converted a water drinker or a soft drink, a soft drink consumer it over?We haven't, have you bettered the life of a single tea producer on this planet?No, and not to mention WHO's, going to appoint themselves the tea police towhat going now to shelves and say well, your specialty and you're, notspecialty the associations in reality, if you actually understand what theasociations do are here, represent the...

...industry as a whole, we're here for thefor the betterment of an entire industry. I just I don't see where thegain is. What do we is an industry gain from it? We don't what value editions,favorably influenced customer perceptions? What are the characteristics areaspects that make team more valuable and therefore more worthy of consumersspending a little more of their pocket change. I think that's an interesting questionbecause you know we can. We can look at it on an analytical level and an nettaste or regardless of what part of the industry there in will tell you thatvalue is placed on pluck on size of leaf on seasonality, perhaps dependingon where the tees come from. On A Roma compounds on clarity of the liquor on, you know just overall flavor, you know if youstarted getting overall, so we can look at it on a very analytical level. Thatway, and, as I said, everit person within the industry, regardless of ifthey're working in traditional or specialty, will agree that there arehigher quality product within the industry. You will not find a singleperson that will object to that. You know on the flip side, when you'reasking, where is a consumer place, spelling the consumer places value inall different aspects, and we can take a look at packaging. We can take a lookat marketing. We can take a look at how we communicate t. You will not find anobjection for me when you know you make the statementthat t is undervalued, it is undervalued, absolutely and as anindustry, we need to do better as a whole to improve that message, and thatcomes in a lot of different fronts that comes in communicating to consumers,not only y to is good for you, but why it should be part of your lifestyle.Your every day. The way that we've seen it in the past year with Covic, youknow people have have been attracted to tea because it makes them feel good. Imean I practically spring that from the roof tops when I heard that Halleluiathis is a long term. You know lifestyle change, that people are actuallycommunicating to US beyond. You know vitamins and Anti Occidents and all therest of those good things that are also part of tea. There are some beautifullygorgeous products out there that you know when people drink it. It's likethis big revelation and it's beautiful where I have issue and where itsassociations we take issue is when we are celebrating that at the expense ofsomething else, tell me why your product is a premium pluck, and it'sand it's a rare, the rarity of it that it's only available for this window oftime when it was plucked. Tell me about how it was crafted. Tell me about youknow the flavor profiles tell me about those things, because we're celebratingwhy this is good. There is a problem with trying to split and splinter upthis indiderat. That's dangerous for everybody and ironic late is mostdangerous for those that are producing our teeth. There's too undervalue. Itis an absolute problem when, when any retailer is putting a two centcertified product on to market, we have as an industry, we have allowed we'veallowed retail to undervalue our product, and the assumption, then, isthat the product is of no value and we have to do better. I mean I have tohonestly say and I'll say this, and you can quote me on it. Shame on US asconsumers. Shame on us as retailers in consuming countries that allow that tohappen...

...intrigue by what you heard in today'spodcast. Would you like to learn more from our global network of pebils Pexperts content them directly through subtext, private message faced platform, avoid the chaos of social media andstart a conversation that matters sub text message base platform lets youprivately ask meaningful questions of the T, experts, academics and TEBjournalists reporting from the Talan. You see their responses via SMS textswhich are sent direct to your phone visit our website and subscribe tosubtext to instantly connect with the most connected people in tea. Remember to visit the tea is websitefor more comprehensive coverage. That's W W W T hyphen Biz Beaz to thanks forlistening very well till next week. I.

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