Tea Drops Bus Station

Kenya Modernizes Its Tea Factories

Tue, 13 Oct 2026 07:38:29 +0800

To capture more domestic value-addition, Kenya continues to implement tea reforms and plans to modernize its tea factories and processing centers. Photo credit: Government Advertising Agency, Kenya

The Kenyan government has launched an investment program to modernize its legacy tea factories located west of the Rift Valley to cut processing costs and boost efficiency. Spearheaded by the Ministry of Agriculture and the Tea Board of Kenya (TBK), this sweeping modernization drive aims to address long-standing infrastructural and processing bottlenecks.

Premium Machinery and Processing Services

The program is part of a wider restructuring of Kenya's smallholder tea sector. It is worth KES 3.5 billion ($27 million) and will refurbish 19 Kenya Tea Development Agency (KTDA) factories. Kenya exported 653,736 tons of tea in 2025, boosting the economy by KES 187 billion, but the country is far from optimizing the value of this product in the global markets. The government aims to ensure at least 40% of Kenya’s tea is value-added locally, rather than exported in bulk.

Under the program, KTDA factories will sign service level agreements to guarantee farmers high-quality services. The program committed KES 584 million towards modernizing 10 tea factories west of the Rift. This bold investment will deliver state‑of‑the‑art machinery, including automatic withering machines, CTC machinery, fluid-bed dryers, steam boilers, pre-sorters and packaging equipment, designed to enhance processing efficiency, improve tea quality, and secure better returns for farmers.

The largest investment, KES 79 million, is for Chebut Tea Factory in Nandi, for a steam boiler, a fluid-bed dryer (600 kgmt/hr), and epoxy flooring. Several factories in Kericho County — Toror, Tegat and Litein — are each receiving KES 65.8 million for automatic withering machines.

Payment Reforms and Quality Assurance

The program is also linked to a major change in green-leaf payments. The digital green leaf payment system is expected to be rolled out within three months. New payment rules are also intended to ensure 50% of farmers' dues are paid upfront, with the balance paid within three months. Agriculture Principal Secretary Kipronoh Rono announced an increase in the green-leaf price from KES 16/kg to KES 26/kg, with the government aiming to reach KES 100/kg by 2027.

Aligned with restructuring, the establishment of the Tea Quality Assurance Laboratory in Mombasa marks a pivotal shift in Kenya's tea sector. Driven by the TBK and the Ministry of Agriculture, this modern scientific testing laboratory is designed to overhaul traditional industry practices and maximize profits for smallholder farmers. The new facility will replace outdated tea tasting methods with science-based evaluation systems to ensure fairness and credibility in pricing Kenyan tea in global markets.

Also, the reform in the sector has granted 10 KTDA factories autonomy from their parent companies, a move expected to improve governance and efficiency. The TBK is expected to grant autonomy to seven more factories within the next two months.

Attracting Foreign Investors

Meanwhile, Kenya aims to attract Chinese investments in the tea factories. Willy Mutai, CEO of TBK, said: “Three Kenyan companies are already using Chinese technology in tea production while additional investments are under development. We are encouraging more Chinese investors to apply for export licenses and invest in tea processing, packaging and value-addition operations in Kenya.”

For the sector’s latest development, KTDA Management Services, on behalf of Mogogosiek Tea Factory Company Limited, invites proposals from suitably qualified and experienced international and national firms, joint ventures and/or consortiums for the Engineering, Procurement, Construction and Financing (EPC+F) of three tea processing satellite factories in Bomet County.

European Port Strikes Disrupt Coffee and Tea Distribution

Tue, 13 Oct 2026 07:38:22 +0800

Strikes in major Northern European ports cause delays to coffee and tea supply chains.

Escalating labor disputes across Northern Europe are sending shockwaves through the continent’s beverage supply chains. Within mere weeks, back-to-back strikes, ranging from German walkouts over stalled wage talks to Dutch protests against social security cuts, have paralyzed major maritime hubs. Because key gateways like Hamburg handle a substantial share of Europe’s coffee and tea imports, the resulting gridlock is squeezing roasters, blenders, and logistics providers with cascading delays and mounting costs.

Germany's wage dispute began on August 18, when dockworkers at Hamburg, Bremerhaven, Wilhelmshaven, Bremen, Brake, and Emden staged a 24-hour walkout that disrupted cargo handling and raised concerns about inland transport backlogs. Negotiations between the ver.di union and the Central Association of German Seaport Operators (ZDS) stalled, and more than 6,000 employees rejected an improved offer. Ver.di then called a longer, 48-hour strike from September 2 to September 4. The ZDS offered a 5.1% pay increase under an 18-month deal, while ver.di is demanding 8.2% over 12 months. The agreement covers around 11,000 employees across multiple locations.

As the German strike wound down, Dutch dockworkers staged their own action. FNV Havens organized an eight-hour work stoppage across Rotterdam, Amsterdam, and Zeeland on September 4, halting ship handling from 11:15 a.m. to 7:00 p.m. local time. Unlike the German dispute, the Dutch action targeted the government's plan to cut €6.5 billion from social security spending, including shortening maximum unemployment benefits from two years to one. It was not connected to the German wage dispute. A spokesperson for ECT Rotterdam said clearing the backlog at its container terminals would take at least several days.

Hamburg: A Critical Piece in the Global Coffee and Tea Trade

These strikes matter most for Hamburg, which handles a disproportionate share of Europe's coffee and tea. The Port of Hamburg imported around 585,000 to 590,000 metric tons of coffee in 2025 and is widely recognized as Europe's largest coffee port. It hosts major trading firms including Neumann Kaffee Gruppe (NKG), the world's largest coffee trader, which re-exported 205,000 tonnes of green coffee in 2024, primarily to Poland, Spain, and the Netherlands. Tea follows a similar pattern: roughly 70% of the European tea trade passes through Hamburg, more than 39,000 tonnes a year, with shipments from China, India, Sri Lanka, and Kenya taking eight to ten weeks to arrive.

Coffee and Tea Shipments Face Mounting Delays

Because Hamburg concentrates so much of Europe's coffee and tea flow through a small number of terminals, even short stoppages ripple outward. With few larger vessels able to be handled at Hamburg during the strike window and Rotterdam's terminals separately paused on September 4, importers face compounding delays: containers arriving late, warehouse and blending schedules pushed back, and higher costs as roasters and packers wait for inventory.

With both sides in the German wage dispute still far apart and Dutch unions signaling further action, more disruption at Hamburg, Bremerhaven, and Rotterdam remains possible in the coming weeks. For coffee roasters, tea blenders, and the logistics providers serving them, the practical response mirrors industry-wide advice: build buffer time into shipping schedules, monitor terminal advisories closely, and expect that clearing backlogs will take longer than the strikes themselves. Given how concentrated global coffee and tea flows are through Hamburg, even a resolution to the German dispute may not fully unwind the congestion until well into the fall shipping season.

Starbucks Considers Japan Divestment

Tue, 13 Oct 2026 07:38:16 +0800

As it revitalizes its US business, Starbucks reshuffles its global operations. Photo credit: Thananat

The Starbucks turnaround plan is starting to pay off, according to CEO Brian Niccol. Two years after he took over and began implementing the “Back to Starbucks” strategy, customers are returning, and sales are rising. “We have returned to growth, delivered positive global comps, and improved margins,” Niccol wrote in a letter to employees this month. “We have positioned Starbucks to perform for the long term.”

It Costs More to Earn More

The turnaround has not been cheap, however. Starbucks is spending $1 billion to refurbish thousands of US cafés, adding comfortable seating and redecorating to make its stores more welcoming to customers. It has also invested in barista staffing, spending $500 million on additional hours and more coverage during peak periods.

At the same time, the coffee giant is looking to cut costs. Starbucks has laid off corporate staff in multiple waves, while closing underperforming stores. As it focuses on reviving its US operations, Starbucks is also realigning its global brand. In November 2025, the company sold a 60% stake in its Chinese business for $4 billion, and now Reuters reports that it is considering a similar move in Japan.

Divesting From Japan

According to Reuters, Starbucks is considering selling a majority stake in its Japan business, a deal that could value what is now its largest international company-operated market at $3 billion. The details have yet to be determined, but Starbucks has reportedly asked financial advisers to pitch various options.

One approach could be to mirror what the company did in China, when it formed a joint venture with the private equity firm Boyu Capital to operate its Chinese business. The move took about 18 months to come to fruition, with the deal valued at $4 billion. “This approach allows us to combine the strength of the Starbucks brand, our coffee expertise, the third place, and our unique partner culture with Boyu’s deep knowledge of the China market and local expertise,” Niccol said in a statement at the time.

While not as large as its Chinese market, in which it operated more than 8,000 stores, Starbucks’ Japanese business is still significant. The company has 1,883 cafés, accounting for almost 9% of its global footprint as of September 2025. “Starbucks Japan is a strong business, with deep brand affinity and trusted presence built over 30 years in the region," a Starbucks spokesperson told Reuters. “We continually assess the best structure to be most meaningful to customers and create value for shareholders.”

Prioritizing US Operations

Experts see the potential move as part of a wider reorganization of Starbucks’ priorities. In June, analysts at TD Securities said that a move to monetize its Japanese business would make strategic sense, allowing Starbucks to concentrate on its core US operations. “This strategy should free up capital to reinvest in brand, product innovation, and digital capabilities,” agreed Bloomberg Intelligence analysts Catherine Lim and Peter Tang.

Two years after its implementation, the narrower focus seems to be working. Niccol’s revitalization plan is starting to pay off. In the second quarter of the 2026 fiscal year, same-store sales in North America rose 7.1% year-over-year. In the third quarter, they climbed 8.1%. “The shine is back on Starbucks,” Niccol recently told CNBC. The company’s global reshuffling is another part of the plan.

Malawi Initiates Digital Payments for Tea Sector

Tue, 13 Oct 2026 07:38:10 +0800

To improve gender equality and enhance tea workers' livelihoods, Malawi is advancing digital payments across its tea supply chain. Photo credit: The Tea Association of Malawi.

The Tea Association of Malawi Limited (TAML) is working to digitize wage payments for workers across the entire tea industry. This initiative aims to promote inclusive growth, enhance productivity, and improve the livelihoods of smallholder tea farmers and laborers, with a particular focus on empowering women within the sector.

TAML partners with Better Than Cash Alliance, working in tea estates in Thyolo and Mulanje to support their transition from cash to digital payments. This alliance is a UN-based partnership of governments, companies and international organizations that accelerates the transition from cash to digital payments.

The Malawi tea sector has an annual monetary flow of $54.8 million among its workforce (approximately 60,000 plantation workers and 22,000 smallholder farmers). To date, the Malawi tea sector has digitized wage payments for 20,000 tea workers and has distributed over $7.2 million digitally since April 2025.

Benefits of Digital Payment

In Malawi, many tea workers and smallholder farmers face long waits to receive their pay. Carrying cash creates safety risks, and limited access to credit pushes people towards expensive informal loans. Digitalization also helps employers reduce the time, cost, and security risks associated with handling large amounts of cash.

Satemwa Tea and Coffee Estate in the Shire Highlands installed an ATM on site eight years ago to support digitalization and will start trial payments through the TAML project at the end of this month. “The cashless ecosystem needed to improve significantly before the current initiative could be both convenient and cost-effective,” Satemwa director Alexander Kay wrote in an email to STiR Coffee and Tea. “Much work still needs to be done.”

Local tea factories face substantial costs associated with cash payments. Specifically, a factory employing 11,200 workers incurs annual expenses of about $37,000 just for managing cash transactions. Across the sector, these expenses exceed $200,000. Conversely, both farmers and workers appreciate the benefits of digital payments, such as greater convenience and enhanced savings options.

The initiative has also facilitated access to more than $500,000 in formal loans for the workers. For instance, digital payment access enabled Rhoda Lucius, a young tea worker in Thyolo, to secure her first formal loan, purchase a tea field, and invest in her family's future.

“There are many positive stories whereby workers and smallholders have been able to access loans through the banking system to buy land, support new businesses, educational needs, etc. at reasonable rates relative to the loan shark systems that have prevailed here,” Kay explained. “The Better Than Cash initiative will only build on this in time.”

Industry-Wide Adoption

Fees associated with current digital transactions are a key barrier, with costs for cashing out and sending money across networks ranging from 1.76-4.11% and 6-23% of the transaction value, respectively. This fee structure makes digital payments less attractive compared to traditional cash transactions. So, financial service providers (FSPs) need to revisit their propositions to the tea sector.

Currently, TAML is hiring a consultant to develop a comprehensive digital payment ecosystem tailored to the tea sector's needs. Essential improvements include broader access to necessary technologies such as mobile phones and lower fees for digital services. Offering relevant financial products such as savings accounts, credit options, insurance, and pensions is also critical.

The consultant is to prepare a detailed implementation plan for new tea-growing states, develop and oversee training programs, and create tools (policy, process monitoring, and evaluation dashboards) for the tea sector’s engagement with FSPs based on the UN principles for responsible digital payment and the Reaching Financial Equality for Women, a strategic framework and action plan.

Moreover, the consultant will facilitate the development of a micro-merchant ecosystem to promote digital usage, develop and implement a scaling roadmap targeting sector-wide adoption, and support the design of additional value-added financial products and solutions in collaboration with selected FSPs.

How Solar Can Power Coffee Production

Tue, 13 Oct 2026 07:38:03 +0800

With drastically reduced installation costs, solar power may just be the answer to coffee’s reliable electricity issues.

Most coffee farmers live and work in remote, rural regions. Many lack access to a reliable power grid to run their equipment or light their homes, often relying instead on diesel generators. At the same time, fuel costs continue to rise, and climate extremes mean an increased risk of blackouts and storm damage. Looking for more reliable and sustainable sources of power, farmers around the world are turning to solar.

The Solar Boom

Solar adoption has soared over the past few decades, as installation prices plummet and availability increases. The cost of solar panels has fallen 90% since 2010, mainly due to China’s heavy investments in solar panel manufacturing. This has made solar increasingly attractive for countries in the Global South, many of whom continue to struggle with poor electricity infrastructure.

“Emerging and developing economies hold 70% of the world’s solar and wind resources and 50% of the critical minerals for the energy transition,” Christiana Figueres and Adair Turner wrote in a 2025 Reuters article. “Based on this potential and their higher energy needs, these countries could account for over 60% of the absolute increase in clean energy over the next 10 years.”

Governments in coffee-producing countries from India to Colombia to Indonesia have launched extensive solar programs. In other countries, the uptake has been decentralized and off-grid, often led by local communities.

“Very Obvious Advantages”

In recent years, coffee farmers and cooperatives have increasingly invested in solar. A growing number of cooperatives in Kenya, for example, have installed solar-powered equipment at their mills to cut costs and improve efficiency.

“There has been a rise in solar installations and utilization in the Kenyan coffee communities,” says Peter Wanjohi, head of coffee at AGnimble. This is “because of the very obvious advantages that it offers over conventional electricity in Kenya. Electricity is very, very expensive,” he adds.

Some projects are self-financed. Others utilize assistance from non-profits or other outside supporters. In 2016, the cooperative El Gorrión in Nicaragua partnered with the NGO Green Empowerment to help 150 of its members install solar systems. The social enterprise green coffee trader Raw Material is working to build solar-powered coffee processing sites in Timor-Leste.

In Colombia, the government’s Energy Communities program began in 2023, and funds mini-grid installations in some of the country’s most remote regions. The Association of Technicians, Professionals, and Producers in Support of the Serranía del Perijá (ASOTEPROS), which works with 80 coffee farmers in the Serranía del Perijá mountains, has been one of the beneficiaries — they have already installed solar panels and batteries and plan a solar dryer to lower costs and improve quality.

Next: Scale

Investing in solar for rural communities goes beyond just the direct impact on coffee production. It can also help improve healthcare and education outcomes in coffee communities. Research shows that access to solar technology boosts educational achievement by, for example, extending study hours.

As coffee production costs continue to rise and solar prices fall, the case for switching to renewable, reliable electricity will only grow. Large organizations are leading the way, with an increasing number of smaller companies and individuals joining the shift. Counter Culture Coffee, for example, has funded solar panels for multiple farmers through its Seeds microgrant program.

The opportunity and demand are there to improve farmers’ lives and livelihoods while greening the coffee industry. What’s missing right now is greater industry and government support and funding.

South Korea Expands Instant Coffee Exports

Tue, 13 Oct 2026 07:38:00 +0800

South Korea leverages its coffee and consumer-packaged goods processing expertise to enter the global instant coffee market.

South Korea is emerging as a global instant coffee supplier. Although the country imports all of its raw coffee beans, its decades-long history in coffee processing, advanced roasting technology, and expertise in consumer-packaged goods engineering have transformed it into a major coffee-exporting powerhouse.

Export Destinations

According to a report from the Korea Rural Economic Institute, exports of coffee-related products reached $230 million in 2024, up 4.6% from the previous year, with a sales volume of 35,349 metric tons. Israel was the largest export market, accounting for $34.6 million (18% of total exports), followed by China (15%), Australia (7%), the Philippines (6.5%), Chile (5.7%), Russia (5.5%), and Malaysia (4.4%).

Israelis tend to prefer strong coffee with milk or creamer. Demand for Korean coffee mixes and liquid coffee in the country is expected to continue rising. An official from the Ministry of Agriculture, Food and Rural Affairs explained, "This is due to the popularity of convenient stick-type coffee mixes in Israel." In 2023, the Israeli government also simplified coffee import procedures to help reduce high food prices, making imported products more price competitive.

The report recommended pursuing Kosher food certification to support expansion into the Israeli market. This certification ensures that specific food products and ingredients comply with all necessary standards of Jewish law, allowing kosher-observant consumers to purchase them.

Major Players Enter the Race

National food giants such as Dongsuh Foods, Lotte Chilsung Beverage, OKF Corporation, and Namyang Dairy Products are leading the export market. The national coffee chain Ediya Coffee has also joined the race. Ediya exports 36 products to 27 countries, including coffee mix, stick coffee, PET drinks, and drip coffee. The Special Mocha Blend is popular in the US and Mongolia; three varieties of Americano stick coffee (Original, Mild, and Special) are popular in Japan; and three types of cup coffee (Toffee Nut, Vanilla, and Cold Brew) are well received in Singapore.

The Korean domestic coffee industry was valued at KRW 3.7 trillion ($2.76 billion) in 2024, according to the Ministry of Agriculture, Food and Rural Affairs. The coffee processing industry added KRW 895 billion in value. The production value reflects major intermediate input costs, including raw materials, electricity, water, outsourced processing, repairs, fuel, and other expenses.

Breakdown of the Market Segments

In 2024, liquid coffee drinks accounted for the largest share of shipment value among coffee-related items, totaling KRW 882 billion (27%), followed by coffee mix (26%), whole bean coffee (21%), and instant coffee (20%). By export value, instant coffee accounted for the largest share at 74%, followed by liquid coffee at 21% and coffee mix at 5%.

The share of coffee processing shipments relative to food manufacturing has steadily increased since 2020. As of 2024, 1,578 registered businesses employed 6,115 people in the coffee processing industry. The industry’s operating profit was KRW 318 billion, with an operating profit margin of 14.8%.

In 2024, the country imported coffee valued at $1.3 billion, totaling 205 million tons. Among the top 10 coffee-importing countries by value, Brazil ranked first, accounting for 20.5% of the total ($275 million), followed by Colombia (12.2%), Vietnam (11.5%), the US (11.5%), Switzerland (10.1%), and Ethiopia (8.8%).

The report highlighted that, as emphasis on individual coffee preferences grows, high-caffeine coffee products have emerged in the market. Consequently, corporate manufacturers are introducing offerings such as double- and triple-shot espresso and cold brew coffee with higher caffeine content.

Saudi Tea Market Merges Tradition With Innovation

Tue, 13 Oct 2026 07:37:52 +0800

Despite its deep roots in tradition, Saudi Arabia’s tea market is being reinvented by health and wellness trends. Photo credit: Marco Elihu Castillo Ramirez

In Saudi Arabia, tea is the language of hospitality, anchoring family gatherings, Ramadan iftars, and neighborhood cafes from Riyadh to Jeddah. The tradition of serving karak, a richly aromatic sweet tea brewed with milk and spices, remains deeply rooted across the Kingdom. Yet habits are quietly shifting. A young, health-minded generation is reaching for green, herbal, and lower-sugar ready-to-drink options, while new regulations and packaging innovations change what appears on shelves. For blenders, brand owners, and packaging suppliers, understanding how a cherished tradition is being reinvented has become essential to winning over future Saudi tea drinkers.

Where Tradition Still Sets the Table

Tea first reached Arab lands along Silk Road trade routes by the ninth century, and Ottoman rule helped spread it further. In the Kingdom, black tea's rise is traced to the early 20th century, arriving through trade with Iraq and the Gulf. It became indispensable through everyday hospitality: offered as a welcome drink to guests, poured from thermoses at Ramadan iftars, and served to pilgrims in Mecca; tea grew into a daily symbol of generosity.

Black tea is still the backbone of Saudi tea culture, and the numbers suggest it is not going anywhere. StrategyHelix forecasts a black tea market worth $406.2 million by 2031, though annual growth is close to flat. That steadiness is the story: this is a mature category defined by loyalty, not novelty.

Zoom out and the picture brightens. The wider Saudi tea market is expected to grow 5.5% annually from 2026 to 2032, with green tea, tea bags, and online stores leading their segments and households driving the fastest-growing demand.

Wellness Turns Green Tea and Matcha Into Rising Stars

Health awareness is the force rewriting the menu. The Saudi green tea and matcha market has been valued at $50.59 million in 2025 and is projected to reach $89.98 million by 2034, with matcha expected to grow fastest.

The same appetite shows up in ready-to-drink. Herbal and premium versions are outpacing the wider regional category, helped by caffeine-free positioning and shoppers willing to pay more for organic, single-origin, or functional claims. Social media and urban cafe culture amplify the shift, especially among younger buyers. Regional flavors such as date, pomegranate, and saffron are also gaining shelf space in Saudi hypermarkets.

Convenience, Compliance, and the New Look of Tea Packaging

Convenience is where tradition meets modernity. Saudi Arabia captured 55.3% of Middle East ready-to-drink tea revenue in 2025, as commuters grab bottles from convenience outlets and quick-commerce apps deliver them chilled in minutes.

Packaging is evolving as well. PET bottles still lead, but aseptic cartons are gaining ground on longer shelf life and sustainability credentials. Meanwhile, Saudi caffeine-labeling rules effective July 2025 are pushing brands to rethink formulations and labels, rewarding those that get design and compliance right. Local brands lean on halal credentials and supply-chain transparency to stand apart from global incumbents.

Saudi tea is not being replaced; it is being expanded. Black tea continues to anchor daily rituals, while green, matcha, herbal, and ready-to-drink options invite new consumers to the ritual. Brands that thrive will honor hospitality traditions while meeting wellness expectations, and those choices will show up in flavors, formulations, and packaging on the shelf. Suppliers who help customers navigate labeling rules, convenience formats, and sustainability will find eager partners. With demand evolving across generations, the Kingdom offers a compelling proving ground for tea businesses ready to blend heritage with innovation and listen to what Saudi drinkers want.

Australia Invests $4 Million in Coffee Research

Tue, 13 Oct 2026 07:37:50 +0800

Australia aims to produce enough coffee to supply the insatiable demand of its domestic market. Photo credit: Zentveld's Coffee Farm, Australia

Australia has launched a five-year Australian coffee research program, marking the largest coordinated investment in the nation’s coffee research and development to date. The program, funded by AgriFutures Australia under the Department of Agriculture, aims to develop coffee varieties, a biosecurity plan and manual, and expand production. Its ultimate goal is to reduce Australia’s dependence on imported coffee.

Southern Cross University will lead the program in partnership with Plant Health Australia (PHA), the University of Queensland, and the Australian Grown Coffee Association. The program’s activities include improving productivity, testing new coffee varieties, strengthening biosecurity, and exploring opportunities for coffee production in new areas. Currently, less than 1% of the 2 billion cups of coffee consumed annually in Australia are produced domestically — an opportunity that AgriFutures Australia intends to capitalize on.

“This program builds on five years of successful variety selection trials and brings together leading expertise from across the country to address industry challenges related to sustainable intensification and biosecurity, ensuring that research delivers tangible benefits for growers,” said Professor Tobias Kretzschmar, Southern Cross University researcher and program lead.

Plant Health Australia

PHA is leading the program’s biosecurity component, which will focus on increasing industry understanding of established and exotic coffee pests and diseases and supporting preparedness across the sector. As part of the project, PHA will develop a new biosecurity plan and an on-farm biosecurity manual for the Australian coffee industry, alongside supporting fact sheets and extension resources. PHA will also engage directly with growers through industry events, activities, and field days.

According to PHA, while Australia remains free from many of the world’s major coffee pests and diseases, including coffee berry borer (Hypothenemus hampei) and coffee leaf rust (Hemileia vastatrix), imported coffee can present potential pathways for exotic pests and pathogens that could limit the industry’s continued growth.

Australia's strict biosecurity measures have successfully kept coffee leaf rust, coffee berry borer, and other pests out of the country. As a result, coffee grown in Australia does not require fungicide treatments for rust or pesticide applications for the borer. This absence of chemical use is reflected on the certification labels.

Domestic Coffee Production and Varieties

High-quality arabica coffee is grown commercially in the tropical tablelands of Far North Queensland, the cooler subtropical regions of south-east Queensland, and northern New South Wales, with the potential to expand into other suitable regions as knowledge, genetics, and production systems continue to improve. Australia's coffee industry comprises around 40 commercial growers, farming approximately 400 hectares, with capacity to produce around 800 tons of coffee each year.

The dominant varietal grown in Australia is Catuai, a hybrid of Mundo Novo and Caturra originally from Brazil via Costa Rica. A government program assessing coffee cultivation viability in Australia's tropics introduced red and yellow Catuai. According to local coffee farmer Jack Murat, researchers are working to expand the varietal base.

Producers are trialing hybrids including Marsellesa, NR25, Paraiso, and IPR107, evaluating cup quality, yield, and adaptability to Australian conditions. Some of this work is being conducted in partnership with Griffith University.

Australian coffee costs more than commodity-grade imported coffee. The industry remains primarily domestic, but specialty roasters in Japan, the UK, and parts of Europe have shown growing interest. As both quality and volume improve, export potential will continue to develop.

Indian Tea Exports Reach Record High

Fri, 04 Sep 2026 10:28:00 +0800

As Indian orthodox black tea exports increase, so do government restrictions on foreign tea imports. Photo credit: Thomas Armeli

India’s tea trade delivered a masterclass in economic resilience in 2025, resulting in an all-time high in exports. Yet, beneath this flavor of global success lies a deeper narrative of self-preservation. As international demand for premium Indian leaves skyrocketed, domestic regulators quietly but firmly tightened the screws on the quality of imports entering the country. Together, these dual forces signal a sector that is not only chasing rapid expansion but is also actively fortifying its reputation as it navigates 2026.

Record Exports Signal Global Demand Shift

India's tea exports reached a record 280.40 million kg in 2025, up from 256.17 million kg the year before, according to provisional Tea Board data. Export earnings climbed to Rs 8,488.43 ($88.55) crore from Rs 7,167.41 crore in 2024. Tea Board Deputy Chairperson C Murugan called it the highest export level ever recorded by India. Industry voices credited orthodox tea, not Crush, Tear, Curl (CTC), for driving the gain, with Assam orthodox leading the charge into new markets.

However, the real story isn't just the sheer volume; it is a fundamental shift in what the world is drinking. While standard CTC teas traditionally dominate domestic teacups, it was the artisanal, whole-leaf orthodox tea, led by Assam’s rich, malty profile, that spearheaded the global conquest. Sophisticated foreign markets are moving away from mass-produced blends in search of authentic, terroir-driven flavors, and Indian estates successfully capitalized on this premiumization trend.

Geopolitical Realignments and New Fronts

The geopolitical map of Indian tea underwent a dramatic transformation in 2025. The Middle East solidified its position as India's primary export destination. Shipments to Iraq surged to 52.59 million kg (up from 40.47 million kg), while the UAE climbed to 50.71 million kg. Notably, Iran’s appetite grew to 11.25 million kg, circumventing direct trade barriers by flowing through the UAE’s bustling re-export hubs.

The most stunning victory, however, occurred farther east. China, traditionally more interested in its own tea, emerged as a major growth engine, with imports of Indian tea jumping to 16.13 million kg in 2025, up from a meager 6.24 million kg in 2024. This massive breakthrough in East Asia provided a crucial buffer, gracefully offsetting a dip in US shipments caused by lingering tariff disruptions.

Drawing the Line: Protecting the Indian Origin Label

However, a booming export market creates a dangerous temptation: the dilution of quality. To prevent cheaper foreign leaves from being blended into the mix, the Tea Board enacted a strict Standard Operating Procedure (SOP). Spurred by the Parliamentary Standing Committee on Commerce’s 194th report, laboratory testing is now mandatory for every single imported tea consignment meant for re-export. For years, regulators harbored an open secret: Duty-free teas imported for re-export (particularly from Nepal) were quietly leaking into the domestic market, occasionally being mislabeled and sold under protected Geographic Indications (GI) such as the world-renowned Darjeeling. Physical testing had lapsed since 2018, relying heavily on easily forged paper trails.

Under the new mandate, importers must declare every shipment and warehouse detail via the Tea Council Portal. Furthermore, blended re-exports must now prove a minimum 50% value addition calculated against FOB and CIF prices. These blended batches must be physically isolated in warehouses, explicitly declared on all packaging certificates, and frozen in place until rigorous chemical clearances are issued.

India’s message is super clear: paperwork alone will no longer suffice, and absolute traceability from port to packing house is the new cost of doing business. By aggressively protecting the integrity of its origin label while satisfying a thirsty global market, India is ensuring that its current export boom isn't just a fleeting high but a sustainable, premium legacy.

Sri Lanka Rapidly Shifts Toward RTD Tea and Re-Exports

Fri, 04 Sep 2026 10:27:58 +0800

Sri Lankan RTD beverage exports, supported by Dilmah’s popular iced tea products, grew by 540% in 2025, making the country a new leading player in the re-export market. Photo credit: Dilmah

The Sri Lankan tea export sector is undergoing a structural transformation. While traditional bulk and packet tea volumes have generally softened, the remarkable rise in re-exports and the emergence of RTD tea suggest that Sri Lanka is evolving from primarily being a tea-producing country into a broader regional hub for tea processing, blending, branding, and export.

According to the Sri Lanka Tea Board, exports of small packets weighing 10kg or less peaked at approximately 113,800 tons, while re-export volume more than doubled from approximately 9.87 million kg in 2021 to approximately 19.9 million kg in 2025, demonstrating Sri Lanka's emergence as a global tea hub. The RTD beverage export also experienced massive growth, reaching 130,931 liters in 2025, up 540% year-on-year (YOY).

The country’s total tea export value reached a record level of $1.5 billion in 2025, up 5% year-on-year. Compared with 2021, export volume decreased, but export value increased by 14%, supported by stronger prices. In terms of export volumes, packets account for the largest share (44.2%), followed by bulk (40.4%), re-exports (7.7%), and bags (7.5%).

Iraq maintained its top import position for the third consecutive year, following 2023 and 2024, with approximately 39.4 million kg (15.3% share). This was followed by Russia (8.4%), Turkey (8.3%), Libya (7.4%), the UAE (7.1%), Chile (4.3%), China (4.0%), Iran (4.0%), Azerbaijan (3.5%), and Saudi Arabia (3.4%).

In 2025, Sri Lanka's total tea production reached approximately 264,616 tons, with Highland Quality (HGQ) accounting for 21%, Middleland Quality (MGQ) 18%, and Lowland Quality (LGQ) 61%. On the global export front, the country is the third-largest tea exporter, with approximately 50% of its tea exported in value-added form.

Sri Lankan RTD tea exporters are increasingly targeting Gulf Cooperation Council countries, Japan, South Korea, Australia, and premium retail chains in Europe. The key export players are Dilmah Ceylon Tea Company Plc, Akbar Brothers Pvt Ltd, Empire Teas, Anverally & Sons, and Stassen Group.

Today, Dilmah stands as Sri Lanka's largest foreign-exchange earner in value-added teas. Dilmah’s vertically integrated model enables the creation of unique offerings such as single-estate teas, seasonal teas, and RTD iced teas. To support the growth of its RTD segment, Dilmah partners with specialized beverage companies that possess the expertise and distribution infrastructure required for this niche.

Dilmah’s RTD tea sales showed 40% YOY growth in 2025. Dilmah Craft Iced Tea is the original iced tea produced using Ceylon tea. Since its launch in 2021, it has quickly become a leader in the global craft iced tea category and is currently available in more than 25 countries.

At the same time, the government is working to restructure its smallholder tea sector through a large-scale “Ceylon Tea Village” program aimed at boosting productivity, value addition, and export earnings, while repositioning the industry towards a $2.5 billion annual export target by 2030.

Plantations and Community Infrastructure Minister Samantha Vidyarathna said that the initiative to build 500 cluster tea villages nationwide will be key to lifting finished tea production to 400 million kg, while improving farmers' incomes and strengthening the country’s global positioning in premium tea markets.

The program, implemented through the Tea Small Holders Development Authority, Sri Lanka Tea Board, Tea Research Institute, and National Plantation Management Institute, will commence in 2026 in 144 tea villages across 14 districts, with an official launch scheduled for July 15.

It envisions creating a nationwide network of integrated agro-industrial clusters. Each cluster village would function as a dynamic local economic hub linking farmers, processors, research institutions, logistics providers, and export markets within a coordinated ecosystem.