Tea Biz
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Tea Biz News and Insight - November 25, 2022

ABOUT THIS EPISODE

HEAR THE HEADLINES – The Tea Industry Welcomes The Climate Summit’s Damage and Loss Fund as wealthy nations agree to pay to repair monumental damage | Solidaridad Asia Hosts India’s First International Small Tea Grower Convention | Japan Expands the Reach of its National World O-CHA Festival

| NEWSMAKER – Rudra Chatterjee, Managing Director, Luxmi Estates

| FEATURE INTRO – Rudra Chatterjee, the dynamic managing director of Luxmi Tea, has expanded and diversified the venerable 30-million-kilo bulk tea producer into direct-to-consumer retail. Luxmi, which operates 25 estates in India and Africa, has shortened the supply chain to deliver fresher tea and now sources herbal infusions and inclusions for blends locally. South Asia Correspondent Aravinda Anantharaman in Bengaluru discusses Chatterjee’s vision for rebranding the company as Luxmi Estates.

Luxmi Embraces Estate-Direct Tea Retail at Scale – In our last interview, Rudra Chatterjee, Managing Director of the 110-year-old Luxmi Tea, spoke about adding retail to the brand’s offerings as COVID brought more consumers online. Two years later, the Luxmi Estates was launched as a retail brand offering a range of teas and a subscription program as a significant business vertical. We catch up with Rudra to hear about the rebranding and his plans.

The Tea Biz Podcast delivers tea news that you need to know, a recap of the week's major headlines with commentary and cultural trends. Hosted by Dan Bolton, it is the voice of origin for tea professionals and enthusiasts worldwide. Tea nourishes and inspires. It is the most ancient of plant based medicines, simultaneously energizing the body as it soothes the mind. Making tea is an art and craft, as described on the Tea Biz Portal, Intimately local, the two hundred billion tea trade exerts global influence, employing millions to enhance the well being of all. Hello, everyone here this week's headlines. The tea industry welcomes the climate summits Damage and Loss fund as wealthy nations agree to pay to repair monumental damage. Solidary ed Asia host India's first international Small Tea Grower Convention. Learn why Japan is expanding the reach of its national World of Chaw Festival. Plus South Asia correspondent Orbanda and Entiment discusses Managing Director Rudra Chatterjee's vision for rebranding Luxmi Tea as Luxmi estates 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, telewakily Boga, Wanthalawa, Harana and Elliptia tea estates support save the children. Sri Lanka. Delegates attending the annual United Nations Climate Summit worked over time to reach an agreement to establish a fund to repair damage and compensate countries suffering the effects of extreme weather. Extreme weather events in in China, Kenya, and India lowered yields and harmed tea quality. Many small growers are uninsured and unable to replace losses or repair flood damaged properties. Quote. This is good news for countries like Kenya that have been affected by climate change, writes The Standard newspaper, but complained that quote talks did not do much to address the causes of global warming end quote. The EU nations in the US have long imposed the fund over concerns the payments will establish...

...a legal liability for trillions of dollars in climate damage since the dawn of the industrial age. Still undecided are specifics on the amounts payable, and a decision on which of the two nations will contribute to the fund and which nations qualify as recipients. Participating nations publicly reaffirm their commitment to keeping rising global temperatures under one point five degrees centigrade, but have yet to agree on language to phase down falsil fuels. New language encourages lower emissions and emphasizes renewables as the future source of energy, but does not specify enforceable emission targets. Delegates express growing skepticism around markets for carbon offsets that quote encourage secrecy, backtracks on the rights of indigenous peoples, and could allow the carbon benefits of some credits to be counted multiple times. End quote. Business Insight Egypt Sam Sukray, who presided over the Climate Summit, told delegates at the closing ceremony that quote, despite the difficulties and the challenges of our times, the divergence of views, and the level of ambition or apprehension, we remain committed to the fight against climate change. End quote. Small growers from across India, Nepal, Bangladesh, Indonesia, China and Sri Lanka in November gathered for the first International Small t Growers Convention in Kolkata. Dr shadow Drew Schada Padre, Managing Director of Solidarya and Asia, said that more than a million small tea growers globally depend on the tea industry. He said that promoting long term health, well being and environmental sustainability and the tea business should be a top priority, but the sector is facing a crisis because of persistently low tea prices which are crushing the livelihoods of small tea farmers. Solutions can be found in technology that transforms low margin commodity agribusiness to purpose driven brands that deliver better value for farmers and enable consumers to influence the price received at the farm gate through supply chain transparency, Innovations in sustainable tea production can empower smallholders. In the early nine nineties, small...

...growers s t gs that contributed only five of tea now produce approximately fifty two of India's t a percentage expected to climb to six. Sustaining the growing number of STGs is a concern as costs rise in all industry segments. As t g s lack scale and are not well versed in good agricultural practices, They find securing financing difficult and have not mastered the advantages of collectivisation. Nay and Tara Pachauri, who chairs the India T Association, said the I T A Solidary ad Partnership seeks a holistic development of the tea industry. Overall improvement in the livelihood of STGs is commendable and attainable according to a tool of Star of good Rick Group, so long as small growers focus on the quality of the harvest and master good agricultural practices. He said. Tea exports are sitting sales records, thanks in part to outreach by Japan's Tea Export Promotion Council. Every three years, Shizuoka hosts a national celebration of tea, Japan's largest event of its kind. This year, as the four day October festival drew to a close, the Council extended the promotion through November. In Malaysia, Sakai Marche, a farm Fresh digital marketplace for hotel and restaurant chefs based in Selangor, Malaysia, partnered which Japanese suppliers to showcase teas at a series of Japanese Week events. Sakai's mission is to help make small scale farmers economic, clue viable and sustainable through improved access to the hundred billion dollar the sea and market. The Export Council reports, Quote restaurants and cafes participating in the promotion draw inspiration from the specialty teas imported directly from their specific farms in Japan by Sakai marsh to create limited edition food and beverages that fit naturally into their menus. In Quote ventures included a bakery that is serving Sissie roll cuissants made with Waquacha organic tea topped with sweet potato, purie, almond, and canako. The Brave Bakery and Kuala Lumpur also created a macha and black sesame brioche. Chakolin Coffee shop more Coqi used macha from Yabaquita organic mixed with a spread so in ginger...

...syrup to create a Mancho latte and a passion fruit with time cold brewd sensia. The Napori Restaurant created a delicate Noma chocolate dessert using white chocolate served with lechy t or fermented tea aged for three months. Business inside Japan reached its peak of production in nineteen eighty with sixty one thousand hectares under tea. About seventy production is now concentrated in three tea growing prefectures. In one, tea was grown on only thirty eight thousand hectors. Production dropped fifteen percent in seventy thousand metric tons, which convinced the government to invest in boosting exports. In export sales set a record of four billion one about hundred and forty seven point five million US, up twenty six point compared to the previous year. The US is now Japan's top tea trading partner, accounting for ten point three billion yen, or about half of all the tea export revenue. Germany is a distant second, buying two billion yen of green tea about fourteen point five million dollars US Arenda and in Terraman in Bengalou reports on this week's t auction prices. Indian tea price support for the weekending nineteen November twenty twenty two. The AG and T Alliance, a partnership between five tea producing countries and represented by the Indian Tea Association. China Tea Marketing Association in the Indon Asian Tea Marketing Association, the Sri Lanka Tea Boat and Japan Tee Association for the second summit in Calcutta earlier this month. The alliance convenient was Solidarity at Asia Naanterra palchy Or the Indian Tea Association was appointed as the first woman chairperson of the alliance. Speaking at the summit, the Indian Union Ministry for Commerce Beach Coil said that there would be more attention on the SMALLTI grower segment to ensure and to ensure a safe source of supply to the factories for tea production. In other news, Danceri Group in Assam has brought forty gardens from the Warrant Group. With this quarrante exists the plantation business in India in deep prices. Exports picked up in South India with nearly nine of Orthodox and CTC leaf grades sold. Prices for Orthodox leave was up by a past pokilo in Kuno. Both Orthodox leaf and dust grades sold well, with prices slightly up from the previous week. In the North calcuttas strong demand for Orthodox degrades with Middle East in the seas countries active. Although there was a good demand for the jill. Prices...

...were lower and both Hindustan Uniliever and Data consumer products were active. There was good demand for both leaf and dust freets and prices were similar to the previous week and now. A word from our sponsor. Q Trade understands that a successful tea blend goes beyond the creative fusion of appearance, aroma and flavor. Our 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 blend. Q Trade meets every brand's retail, food service and e commerce need. For more information, visitor website, Huge Trade Tea dot com. Rudrid schatter Ge, the dynamic Managing Director of Luxmi T, has expanded and diversified the venerable thirty million kilo per year bulk tea producer in to director consumer retail. Lux Me, which operates twenty five estates in India and Africa, has shortened the supply chain to deliver fresher Tea and now sources herbal infusions and inclusions for Berlen's locally South Asia. Correspondent or into an entrement in Bengaluru discusses chatter gs vision for rebranding the company as luxmi Estates. In our last interview with Stategy managing director of the hundred ten year old Luxmi Tea company, he's spoken about adding retail to the brands. Fringis Covid brought more consumers online. Two years later, the luxury Estates has been launched as a retail brand, offering a range of trees and a subscription program and seems to be a significant business vertical. We catch up with a lot of here about the rebranding exercise and his plans for it. Thank you for joining us a t Businrutra. There's a been a vile since we last spoken. In this time, Luxuryty Company has gone through an entire rebranding exercise. Don't talk to us about it. My census that actually aspectful. There's some right at the top, but that I think it's un I always that this is a company that was born in some sort of revolution, so we want to do something new, whether it's planting which was in Africa or although it wasn't part of Lestman then doing organic, so it has a lot of nammuntings. The aspectually number one is it's here more than any other product that he is best fresh, but...

...the supply chain is designed to make it as fresh as possible. I think that's something that we would like to start and we would like many other companies to follow to make the teas as fresh and havent using technology to the customer as soon as possible. So that's one aspect. The second aspect, which is I think even more worthwhile, is yes, it's have become monocultural spaces, but it's important to grow other hubs, other things for good or bad. He is considered good, healthy, heart beverage, and so if even a company for hundred years as tea goers, we have decided to say that, you know, there are amazing places that grow tomeric right next to ot and that is high cold comin level. Actually, we are not inventing any herb on. The herbs that we're using are the ones that people for hundreds of years and you that are good for good for you. So whether it's termeric, whether it's where they could see whether it's uh masala, try lavender. All of these are well known bobs. But my goal is to source as much as it locally, whether from our own estate or but using farmers near arrested so African rose from Rwanda, termeric from using him, shuggar, mangoes, very using bandara labu, so all these things which are part of our touch and so nothing that is just your flavor. These are herbs. And along with that we obviously started our website and one of the thing is focus on the estate. And that's why we call it Luxtrimy Estates because you know when a company is called Lustramy, we are Lutrimity company. That's the official name of the company with the brand is Lustrimi states because it's I want to say that these teas are from mistakes. These teas haven't been bought by someone and packed. And so the second aspect is using the hand is to basically say our lucky he's the black and it's our hand. And the opinions when we talk about the issues in the plantation sector of the industry, I think a lot of it is solvable. I've said that in an interview to you before. If we can sell the team, if I can say that okay, part of the revenue and that part should keep going up, we'll go to getting good impact in the power. You've done more than ten floords on education within the t sts. But we cannot we don't have the budget to keep going I unless we find another source of revenue. So I think all of it comes together, the monocultural aspect, you know, questionest of the t the lives of the workers. So I am quite confident that we...

...will succeed. The reason is who doesn't want a better product pressure at a fair price. You see, the prices are good, They're not very expensive, but nicely packaged foods are loose. And we are not trying to re invent what is good for you. You know what is good for you. You know is good for you. You know it is good for you. We will find the best sauce of it. That is what we are good at now, going through the comment creating the best sauce, making sure edge back to back and you know, shipped to you very quickly. And that's one reason why we Because we are starting in the winter, we started with the puple these we will add some of the regular teas also, but we wanted to start the regulaties and during the first flush, and the prbert is now because this is the time for these kind of pulps. So that that's my long overview of this what we're trying to do, I think, I mean last it was also about how you know, you're excited by the conversations you were having with the consumers via social media and the interaction that you are having, and that has really sort of driven a whole shift, isn't it, In how you're looking at retail, how you're looking at direct to consumer and all of that. The most important thing is the difference between selling to an invisible hand. You see the prices on the screen, but you hardly know who's buying, and you don't know how many steps it will go before the consumer comes. And I have said, I think at that time, even if we can sell one percent of our tease to consumers, we know and hear their opinion and what is it that they like and what is it that they don't like? Because sometimes it's great to hear that, you know. I love the fact that Rugabano is right. I feel that it's keeps at a few minutes instead of four minutes. And that carries on to this conversation about tutsi and turmeric and whether green tea will go with it or I'm absolutely open to experimentation. The only thing is I am enough of purest to not add raspberry flavor or something to the tea because I like the tea as it is. But if it is, if it is something which goes with green tea, you know it is one plus one is actually not less than two. But it actually adds something and make it easily accessible to the customer. And I know that it is Actually the money is going back to the farm, It is not being taken away from the farm. And actually the flavors being added by some population that is you know that is bad for the industry. This is good for the industry. It is you know, it is giving you know, you know, whether it's ginger that is produced, excellent ginger producing as I am excellent ginger. You know the oranges of Mahayan,...

...the leven class of Mahay, the ginger, and you know other bodies from ginger, obviously others ginger. Now there's never the damage that monocultural props do extends to taste it. So it's very good to have many other things along with trea and also create other interome streams, whether from flowers or honey or herbs for workers like we did, we are doing homestays in the tests. This needs an imaginative solution. It is not a competitive solution. It's an imaginative solution. And you know it's it's something that you know, I would welcome everybody to try because it's something that we should all. I'm not saying there should be one big brand. There should be several big brands, you know it, but all of them should be fresh from the farm to the like wine is how big is retail part of what Lakshmi does out and you know, what are you're expecting to see? And also the addition of the herbal teas itself. Where did that come from? Was it? Was it the whole fallout of COVID when the demand for such a kind of tea increase or is it the fact that you know, you say that you had access to all these herbs and you know, spices and all of that and it just made sense to you know, venture into that space. So what was thinking behind that? So a couple of things. One is even much before COVID, you know, growing up in a team myself, I'm very keen on different kinds of food, So I get like honey from Mona State, I get ginger and tomeric, I get red rice, I get peppercorn. So I've never thought that the States only produced to but you know, it's that one is the commercial aspect of it, but there are many others, and now, certainly during COVID, one thing that changes. I spent all the time in the tasted not um in the city, a little bit in but mostly in the list, so I had a much you know, in some ways it was a far more open interaction with all the people that Secondly, I think it's clear, while you know people were coming and staying in Marka Bardy, I could actually see consumers of Marka Bardy staying in May and telling me things that why aren't you doing? You no mango with this, and why aren't you doing And we started that and started selling it in charge, and then we started selling it in Bargoa airport, and from that, you know, sample set of a few people, it was very clear that this is certainly something that customers are appreciating and you know, frankly, even even though the we were asking about the percentage of business, I don't want this to at all the all the teams that left me make sure get into our packages. Not at all. We will continue selling by the traditional...

...channel channels and we will sell options. We are very as I said, very grateful for the business um and our prices have also been fine. You know, you might have seen the SAM prices the Rwanda now and Ruga Bando's number one and number two in all of you know, whether it is Makaibari or the more Anti states, and all of these are making very very good teas. But it's important to think of this as a sustainable solution for the long term. I just don't see why we will not go straight to the consumers with some of the teas. It's not certainly going to be uh. People will continue buying the team from supermarkets mostly, but some people, you know, might care about something different and something that they really care about, and they might want to subscribe that they really like, you know, strong the operas Anti they might subscribe it from us. So that's that's the thought. It's still evolving. By the way, it's not I can't say that. You know, I figured to figured this out. It's just evolving, and I'm open to customary, customary imports and reviews. And you know, my goal only thing is the challenge of this is am I able to ensure that we are not weak in the packaging or the delivery of the product, because sometimes, you know, it's so rustic when you do something from the farm. You said, what's from the farm, but it's not the same. The package doesn't open properly, it's dripping or something. I don't want that. I want people to say, Okay, this is a world class company making a world class product, but from the you know, all all the classes of coming straight from the park, and what has been the response of the people on your estates, both the factory and the fields. Fantastic. I mentioned I mentioned to you last time. It's you know, we love talking people. The tea planters love talking as you know, you're spoken to a lot of them. So this is given us a whole new set of conversations. And you know, people compete about the fact that customeryview and what they like and and you know, if there is one review on one website you'll see a TST manager like taking a photograph of it and what's happing it to everybody is saying, this is the comment from this customer. You know, it's actually great. You know it's whether it's and also I think it makes a huge you know, the more you put sunlight on work conditions in the taste, the more change you will get. And and it is important that consumers understand that there's a cost to do. The money does not come from anyone other than customers. When you're making the product, the only customers, you know, every every penny we spend on everything is come from the customers who BUYOT. So we would like to make a specialty or really discerning customers and hopefully that will pay for some better facilities and infrastructure also other than introducing the customer to a great product. Right, So when you look...

...at you know, when you look at the Indian industry scenario itself today, given the kind of changes you've brought into Luction with it's a product innovation, whether it's you know, going to direct to consumer and all of that in tourism itself. Um, what do you think, you know, what would you like to see is fast changes in the Indian industry. So goes what do you think it needs in terms of solutions being a business to Businesses do well when they are most to the wall and forced to love it. And the industry is in such a position today. We have been pushed to the wall. The way we worked over the last fifty years really not working. Props are coming down, climate change is adding costs. They've been incredibly hot is this summer and then we are having a lot of reading towards the end of the season. Now it was industry which love routine, up a fight eartly in the morning, we are from the instead get the sucking rounds in seven days, back to the t and forget about it and go back for next weekend. That's not going to work an there's you have to keep the discipline of the routine, but you have to add the willingness to change whatever we're doing every now now and then. That's how most of the industry is, That's how most other industries. There needs to be some radical changes. For example, I think um I do think that the government and industry should work together and replant forests and some of the tea estates. It's uh, we cannot have this incredibly mono cultural environment. And with a lot of the forests having gone, the pests have increased, the climates has changed. So I think there has to be a incentive to do that for the from the government. But there can be some learning out of the forests, whether it is from timber or from honey or from fruits or whatever it is. And and we have to love it. Like one of the things I always say that, you know, it's we need more women in the tasty you know, living in the tests and you know, just be are you thinking how this business has done has been just done the same way from maybe late eighteen hundred and nine hundred. Obviously there's been some changes CTC, has um and some of this, but the changes have been few and far between. You know, it is important to realize that teamaste can provide jobs between the seeds, and it is important for everybody to want the success of the te industry not just say that, you know, we don't care about the succesul the t invest you we just want you know, the the entitlements out of the industry that does not work and that cannot work. So that's how you know, it's I think it's a big concern when you see many bign companies who...

...have been fantastic in the industry, how they have you know, I haven't been able to continue. And then you know, if we we to sit up and say that, you know, these were very well done companies were very well run management. You know, the twenty one century challenges are new. I think I hear a lot of planters say that you know, but well, do everything you're asking of us, but it has to be financially sustainable. But it's also our job. Two, I think as management, not just ask someone assault in the produce. You know, you know, we every management has a responsibility to keep the business successful. It's not it's not it cannot be outsourced. In your opinion, how has Indian consumer changed? How has consumption changed? And how has the branding of tea within the Indian Indian market? It's up? What has what have you seen change? I think he is the best product in the world to channel like five reasons. Number one is it's a habitual product. We cans a right rout the food products. We can't return it. It's high value to weight product. It is a product you can gift and there's a product that doesn't matter what your religion is, what your age is. It's good for you product. It's a healthy product. Maybe coffee also is an equally good product. But the advantage that he has this has many many more varieties. So in terms of being able to have many s k O s small emocus, he's an advantage that he has over coffee online. And and also, um, I haven't that that the fresh of the product the better. It is, so not only online but online straight from the farm. And also, by the way, it's the most consuming product in the world when it comes to you know, the daily consumption of anyone product, more than salt or anything. So all of that together it is it is a product which will certainly makes a lot of sense online. But now the thing is, it may not. It may be all significantly. Maybe the last mine may not be online or some other aspects. But I think producers who are thinking about it is they're doing the right thing. And you know, we many of us will succeed and many of us won't. But I think the journey, the trajectory of this business is to take this business from increated like a commodity to a very personalized product right in the context of Indian t what do you think brand Indian team needs right now? Yeah? Number one is why isn't Indity available outside India? When I traveled abroad, I rarely see that inches within Dente...

...on it you see Italian olive oil and Swiss chocolates. Now you also just see Jesus from around the world. But why don't you see indentity go in trouvel with. I think the key aspect is that certainly the supply chain to which Ninty was sold some of it will le born the same way that he has been sold for a lot long time, just the way everything has changes. This is also going to check and we just have to figure out how it's going to be. It's not going to be. Ness said in the same The positive side is there's this notion that I used to hear that people young people don't drink. That's not true. That's uh. I don't know why that gained credits. I think young people are Did you seek consumption of alcohol? Did you sink consumption of sugar drinks? And I think there do you think the dumption of plastic bottles and all of that, jeez, agnostic hold like I tried this plenty for our SETI superior dodging the best t I've had in a long time, and it's completely different from the T I usually. But it's if it's if it's great dodging intreaters. You know, it will taste great, you know, if you let it bloom and involved in the right way. Okay, that last question for you again in the context of the larger industry, the Indian industry. So you know, how how do you you view the domestic market and what do you think, you know, how do you think we can make those connections between the Indian consumers and the Indian producers stronger and more you know effective? I think it has to be through various ways. And there's not one into Juma, There's not one in introducer. It is going to be different kinds of Indian consumers and different kinds of in the introducers. Is how are you the Indian consumer? There's one thing which is generally true about the Indian consumer. They they will m go after authenticity, they will go after good value, they will go after freshness, and that is what we need to drive at in terms of the Indian producers. The good team is being appreciated every year. We can see them the price difference between the best and the rest for the best and the top best side, the bottom best side is a V shaped con so that he's saying something and we have to hear that customers and what the customers saying...

...and then decide how we what what businesses do. We have to take actions to meet the customers requirement. There are all kinds of customers for all kinds of producers, so relegis to tek the right connection. M H. Intrigued by what you've heard in today's podcast, would you like to learn more from our global network of t BZ journalists and T experts. Remember to visit the t BZ website from more comprehensive coverage. That's w W W T hyphen biz b I Z alcohol. Thanks for listening, farewell until next week.

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