Tea Biz
Tea Biz

Episode · 8 months ago

Tea News and Biz Insights - October 29, 2021

ABOUT THIS EPISODE

HEAR THE HEADLINES – Fairtrade International Predicts Growers Climate-Related Financial Disaster | Chemical Fertilizer Supplies Disrupted | Holiday Helpers Are in Short Supply| NEWSMAKER – Will Battle, author, consultant, and enthusiast for all things tea. Will trained as a taster in India, Sri Lanka, Kenya, and Malawi and has 20 years of experience sourcing tea. He is the author of “The World Tea Encyclopaedia” and managing director of Fine Tea Merchants, Ltd., in Lincoln, England. | FEATURES – This week Tea Biz travels to Lincoln, England for a visit with Will Battle, author of “The World Tea Encyclopaedia” and managing director of Fine Tea Merchants, Ltd., a wholesale tea import and export venture that supplies tea merchants with mainstream offerings as well as rare teas and herbals.The Unique Cost of Producing Specialty TeaConsumers who pay a premium at retail for specialty tea often leave growers to foot the bill. The costs of producing the distinctive taste of the authentic, transparent, eco-friendly, clean-label formulations that are so popular with Millennial and Gen Z cohorts are significantly higher than what growers spend supplying conventional tea. A preference for chemical-free cultivation, third-party certifications, energy-efficient, carbon-neutral processing and transport, and recyclable and biodegradable packaging further erode margins along the length of the supply chain. This raises a fundamental question: Is anyone making money making specialty tea?

The Tea Biz podcast delivers a recap of the week's major tea news headlines, with commentary and cultural trends. Hosted by Dan Bolton, Te Biz is the voice of origin for Pea professionals and enthusiast's world. Plot think of us as a digital caravan of story tellers, bringing authentic, authoritative and exclusive stories to you weekly from the tea lands. Hello everyone here this week's headlines. Fair trade international predicts climate related financial disaster for growers. Chemical Fertilizer supplies are disrupted and holiday helpers are in short supply. More in a minute, but first this important message. What makes a Perfect Cup of Ceylon tea? The Perfect Cup is from the tea businesses that ensure the protection of all the children living within their tea estates. We Salute Kailani Valley, tellawackilee, Bogajanthalawa, Harana and Elyptia tea estates support Save the children. Sri Lanka, a hotter and drier climate polls as a severe financial threat to millions of farmers in major tea growing regions, according to Fair Trade International. The organization released a hundred and forty eight page report this week ahead of the United Nations Climate Change Conference in Scotland, fair trade called results of the study, quote, extremely alarming in a clarion call for immediate and comprehensive climate action and quote. The study assessed climate impacts on producers of bananas, Cocoa, coffee, cotton, sugarcane and...

...tea and, summarizing the impact on tea, the authors named East and South Africa and South and Southeast Asia as hot spots likely to suffer heat stress. Quote. Asian tea producers will, on average, experience slightly more days without precipitation, while most African tea producers will experience fewer days without precipitation. Producers in Malawi and Tanzania will be severely impacted by increases in days without precipitation. According to the report, tea producers in southern India will be particularly impacted by increased heat stress. Quote. Nearly all producers will experience more than thirty additional days with extreme temperatures under the two most likely scenarios. End. Quote. According to the report, limited financial resources under lie the level of anxiety African tea growers participating in the study identified two thousand and nineteen as the first year in which climate change led to financial setbacks. India, tea growers reported a milder financial impact, beginning in two thousand and nineteen. Quote. Producers in Ghana are more pessimistic than Indian producers regarding the future and quote. According to the study, in India, producers are more concerned about the lack of labor than the immediate financial risk. According to the report, access to credit may be a limitation for farmers who wish to invest in their farms to better adapt to heat and less precipitation. According to the report, most reported money lenders as their main source of credit. Business insight. African tea farmers view the...

...financial impact of climate change is moderate to very severe, according to the report. Quote. In general, farmers perceive the highest levels of risk in connection with higher temperatures, changing precipitation patterns and the availability of water and quote. According to the study, which was financed by the European Union and conducted by Vu Amsterdam and the Burn University of Applied Scientists. The report is free to download and available on the TAB is blog. THE SUDDEN CLOSURE OF FERTILIZER MANUFACTURING PLANTS IN THE UK and record high prices approaching a thousand dollars per short ton in North America, for tell cutbacks as global food prices reach at ten year high. There are ample stocks and capacity, but timely arrival is a concern due to the shipping crisis, and fertilizer prices are prohibitively high for some applications due to rising energy costs. China, the world's largest agrochemical manufacturer by tonnage, cut output due to rising energy prices, but has since allowed manufacturers to maintain high operating rates to meet domestic food security requirements. Fertilizer exports surged in two thousand and twenty one, but the total of ten point eight million metric tons during the first eight months of the year, an increase of forty six percent compared to the same period in two thousand and twenty. In July, China suspended phosphate exports and in August exports decline by twenty six percent to two point seven eight million metric tons. As prices spike across a broad range of plant nutrients, European growers say they may be forced to idle crop lands or...

...plant less fertilized or depending crops than corn, for example, in the US, the price of urea increased twenty six percent in the past month, reaching eighty cents per pound nitrogen, and an hydrous at fifty seven cents per pound nitrogen, is averaging nine hundred and forty dollars per ton, pot ashes of fifteen percent compared to September. Two Thousand and twenty business inside. The disruption is troubling because tea is a very demanding plant, requiring three to four hundred kilos of nitrogen perhector for high quality shoots, plus three secondary nutrients and ten trace elements. No soil in any part of the world can continuously provide full nourishment for plants when they're producing economically significant yields without the use of fertilizer. Workers in US retail and warehouse fulfilment or in high demand and short supply as major employer's staff up for the holidays. Seasonal culinary workers, delivery drivers and retail clerks are among the four point three million, quote, missing workers and quote, unable or unwilling to return to work, according to the Wall Street Journal. Money magazine notes that ten percent of seasonal job postings on indeedcom include the description urgent Amazon expects to hire a hundred and fifty thousand seasonal workers, up fifty percent from twenty twenty, and is paying an average eighteen dollars per hour. Supervisors can qualify for three thousand dollars signing bonuses in key slots. UPS is advertising warehouse and package handler jobs at twenty two per hour. Walmart,...

...target and Fedex round out the top five seasonal employers, with a combined six hundred thousand slots to fill. In response, smaller retailers and cafes are offering additional hours and more stable work hours to existing employees, investing in staff training and promising to transition. The most promise missing new, higherst full time work in two thousand and twenty two business inside, there are ten million openings as workers quit at the highest rate on record. The greatest decline and the eligible worker participation rate is among women, workers without a college degree and those in low paying service industries such as hotels, restaurants and childcare. According to The Wall Street Journal, the pandemic accelerated early retirements among those fifty five and older, a trend that economists say is unlikely to reverse. New Hires are requesting more flexibility and benefits. The shortage means seasonal and full time job seekers have greater leverage. They shared and negotiate bonuses and benefits and wages greater than fifteen dollars per hour. Arev and Dan and there Aman in Bengaluru reports on this week's India tea auction prices. India teap price support for the week ending twenty third October twenty twenty one. The focus this week is in the auctions and seal number forty two north India. After a missed weeak of auctions are good demand. In Colcata, Gohati and tillygoty auctions anders. In fact, last week saw the highest weekly sealed volume for two thousand and twenty one. In Calcutta, eighty three percent of Orthodox tea and OFFA was sold, with the Middle East domaining the top bio, however, that g link tees are...

...less uptick. In Gohati the market showed good demand for both CDC and Orthodox teas and major blenders were active. In the south, dusty continue to perform better than leaf across quo, Chikunu and Coimbato. Auctions in canute by us from north India were active reportedly due to the demand from the Vali, which is one of the biggest Indian festivals and it's coming up next week. Exports continue to be subdued because of container costs. Hundred eight kilos of green tea on offer and Kuno soul for a piece three hundred puckillo. And now a word from our sponsor. Que Trade understands that a successful tea blend goes beyond the creative fusion of appearance, a Roma and flavor. Are Multi Award winning product development team is passionate about converting natural ingredients into sensory experiences that customers crave. Every recipe is formulated with a commercial backbone of dependable quality sourcing, with a pricing structure that supports as safe, regulated, profitable and scalable bland. Que Trade meets every brand's retail, food service and ECOMMERCE need. For more information, visit our website. Few Trade teascom this way. Tabe is trou wills to link in England for a visit with will battle, author of the World Tea Encyclopedia and Managing Director of Fine Tea Merchants Limited, a wholesale tea importer and export venture that supplies tea merchants with mainstream offerings as well as rare teas and herbals. Consumers who pay a premium in retail for specialty tea often leave growers to foot the bill. The cost of producing the distinctive taste of the authentic, transparent, ego friendly, clean label formulations that are so popular with millennial and Gen z cohorts are significantly higher than what growers spend supplying conventional...

...tea. A preference for chemical free cultivation, third party certifications, energy efficient carbon neutral processing and transport and recyclable and biodegradable padg eaching further eroad margins along the length of the supply chain. This raises a fundamental question. Is Anyone making money making specialty tea? Joining us today is will battle author, consultant and enthusiast for all things tea. Well trained as a taster in India, Shaalaca Canyon Malawi and has twenty years of experience sourcing tea in this segment. He just crimes the unique cost to growers producing special dyt in part two, two bills will interview brand and category managers on the coast they incur and bringing specialty to the market will from a glorious perspective as manufacturing specialty to worthy effort. I think frequently it probably isn't really. Now look at some of the growers I deal with and the amount that they need to invests from a financial and a human resources perspective. It's so much greater in almost every area. I struggle to see many instances where that's appropriately rewarded. And and that's pretty much all stages of the chain in my experience, Danny. Now, whether it's the pruning, the approach to pruning, to lead quality stipulated to pluckers or two, those buying leaf on the open market, the level of detail that the factory need to apply to the processing of the leaf, right on through storage shipping, all of those processes in my experience, cost a lot...

...more in the speciality industry and more often not I don't see that rewarded appropriately. Let's flocks or suffix will course through your neigue to producing special duty. Let's take darjeeling, for example. Your your approach to the pruning cycle. Perhaps a good case in point would be my experience with Jastree's darjeelings this year. They pruned more than they did previous years will be more than most other producers. And a light prune in Darjeeling effectively rights off your first flush. But it might give you a better late second flush and then next year you'll probably having an improved quality as well. But to write off your first flush and Darjeeling is just an enormous financial handicap to impose on yourself. That's your that's your start point. The costs of for a kilo of fine plucked leaf, it might be in the pre minimum pricing era, seven hundred and twenty nine Kenyan shillings an hour for mainstream leaf, but around twenty five for specialty leaf. You've not even got the leaf to the factory yet and you're already way. You are an enormous margin to make up in the final product cost. And don't forget you've got for four point two to forward six kilods of your green leaf for your may tea. So you've you've got a big headweight to makeup on the final product cost and you haven't even start good to the factory yet. Another example might be the traditional way of getting teach the tea leaf, green leaf, to the factory might be to dump it in a pickup, but there they put it in the special aerrated baskets to get it to the factory, and that two or three pickup trucks getting the leaf there rather than one or a tractor, and that's fuel costs and wages again,...

...just another increment on too the the final product cost. And you can go on and on in it and I see that right through the process. Will couldsumers pay a premium for a specialty to what is the value they receive? Your you're ultimately investing in quality and an approach to creating a product that is the best it can be. A large proportion of it should end up back in the communities that have spent the time in trying to create it for you. So wherever that specialty t comes from, whether or not it's Japan, the Darjeeling, a Sam Dimbula or Malawi, that investment in the regions and the districts that are making the tea is something that really is worth while. It's worth remembering that those people who are making good specialty t are often improving their mainstream quality as well. Why is a good proctice to pay farm gate prices that allow sustainable production, not just for specialty T as you mentioned, but commodity to as well. It's a good practice because, I mean we ultimately we have an obligation to make sure our industry service, and that is reliance upon the people who grow and pluck and process t. If we don't pay a sustainable price, they will do something else. Without an appropriate farm gate price, we don't have an industry down in my view, and it's our obligation to make sure that any producer is appropriately remunerated. Otherwise, why would you rote intrigued by what you heard and to do is podcast. Would you like to learn more from our global network of Cuba's journalists and t experts?...

Remember to visit the TV Biz website for more comprehensive coverage. That's wwwten BIS bislcol thanks for listening. Farewell till next week.

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