Tea is the world’s most consumed drink, after water. Tea is thought to have originated in northeast India, north Myanmar (Burma), and southwest China, but the specific location is unknown. Tea was consumed in China over 5000 years ago, according to evidence. Tea is the most popular produced drink in the world, outselling all others combined (including coffee, soft drinks, and alcohol). The majority of tea eaten outside of East Asia is grown on enormous plantations in the hilly regions of India and Sri Lanka for sale to large corporations. In contrast to this large-scale industrial manufacturing, there are several little ""gardens,"" often miniscule plantations that create highly sought-after teas treasured by gourmets. These teas are rare and expensive, comparable in price to some of the most expensive wines. Tea is more than just a drink in many places; it is an old custom that is distinctive to each culture. Tea comes in a variety of flavours that vary depending on the oxidation and fermentation techniques used. Tea planting provides employment and income to millions of smallholder growers in various countries, supplementing or even replacing production from larger tea estates. While three-quarters of tea produced is consumed domestically, tea is a commodity that is widely traded and exported. The global tea industry has grown rapidly in recent decades, with an increasing number of customers worldwide. Tea is a beverage made from the Camellia sinensis plant's leaves. It is available in a variety of flavours, aromas, and colours, including black, green, oolong, white, and herbal teas. It is high in antioxidants, which can help protect the body from free radical damage. It's a fragrant beverage created by pouring boiling or hot water over fresh or cured tea leaves. It also includes caffeine and other helpful components like theanine, which can boost mental alertness and reduce stress. It helps to improve heart health, lower the risk of certain cancers, and promote weight management. According to the research report, “Global Tea Market Outlook, 2028” published by Bonafide Research, the market is anticipated to cross USD 90 Billion by 2028, increasing from USD 61.50 Billion in 2022. The market is expected to grow with 6.88% CAGR by 2023-28. The growing consumer demand for drinking tea among the masses due to its multiple benefits and rising health consciousness among individuals is one of the primary reasons supporting global market expansion. Furthermore, the growing preference for ready-to-drink (RTD) beverages as a result of rapid urbanization, hectic lifestyles, and rising consumer purchasing power is positively influencing the industry. Furthermore, the increased installation of tea booths at airports, hospitals, shopping malls, school canteens, railways, and gas stations is promoting market expansion. Aside from that, product producers are releasing new and unique tea flavours like mint, lemon, orange, cranberry, and pomegranate to broaden their product line and existing consumer base. They are also focusing on the release of organic tea varieties that cater to various health concerns, such as diabetes and obesity, and aid in digestion, immune system strengthening, cholesterol control, and lowering the risk of heart attacks. One of the significant trends that will gain traction in the tea market over the projected period is the introduction of specialized iced teas. Vendors are creating unique iced teas by tailoring various blends. Furthermore, due to expanding popularity, organic label and herbal teas are becoming more popular. This can be linked to the health advantages and improved benefits of herbs such as basil, tulsi, and others, which are moving customer preferences toward goods based on natural ingredients. Market leaders are introducing fresh and healthful tea items that are enticing consumers all around the world. Tea provides hydration, quick refreshment, and energizing benefits that are favourable to the health of the consumer. Various herbal versions with reinforced nutrients are available in a variety of sizes and flavours on the market, pushing their expansion. To attract customers, market firms are launching ayurvedic and herbal tea. For example, in June 2022, the Clipper Tea Company of the United Kingdom increased their product line in the United States with new packaging and tastes. Organic earl grey black tea, organic orange & turmeric herbal tea, organic green tea & lemon, organic winter apple and cinnamon herbal tea, and organic winter berries herbal tea are among the new tastes. Tea is a quick and simple beverage to prepare, making it a great choice for people who lead hectic lives. Consumers may prepare a cup of tea in a matter of minutes, and certain teas are available in pre-packaged tea bags or pods, further simplifying the procedure. Tea, whether in a travel mug, thermos, or pre-packaged container, is a portable beverage that may be taken on the go. This makes tea a great choice for folks on the road who need a quick pick-me-up. Tea is a versatile beverage that can be consumed hot or cold, with or without extra tastes, and as a base for other beverages such as iced tea or tea lattes. Tea's adaptability makes it an ideal choice for a range of events. The convenience of these products has fuelled the rise of the ready-to-drink sector. Pre-bottled tea beverages are available at grocery stores, gas stations, and convenience stores, making it simple to enjoy tea on-the-go. Tea products are becoming an increasingly popular alternative for consumers with busy lifestyles due to its simplicity of preparation, portability, flexibility, and availability. The Asia-Pacific region holds a prominent position in the global tea market as both a major producer and consumer of tea products, and this dominance is expected to continue in the forecast period. China and India play significant roles in the production and export of green tea and black tea, respectively, on a global scale. Other notable tea markets in APAC include Japan, Sri Lanka, Vietnam, and Indonesia. The increasing consumption of tea is a key driver for market growth in the region. India stood out as one of the largest markets for black tea production and consumption in 2020, while China led in green tea production and consumption, surpassing Japan. The e-commerce sector, facilitated by popular platforms like Amazon, Alibaba, and Flipkart, is gaining momentum in APAC, contributing to the expansion of tea sales through online channels. The worldwide tea market is divided into nations such as the United Kingdom, Turkey, Ireland, Iran, Russia, Morocco, New Zealand, Egypt, Poland, Japan, Chile, Saudi Arabia, South Africa, the Netherlands, Australia, the UAE, Germany, Hong Kong, Ukraine, India, China, and the United States. The tea market in India benefits from a strong tea culture and the commitment of Indian tea aficionados. Consumers in India want greater variety in tea, which has led to the rise of the tea industry. The urban population in India is becoming more health-conscious, while tea has long been known as a stress reliever for the rural population. The fast economic development and increased disposable income of the Indian middle class have driven the tea industry's expansion and spurred innovation. The distribution networks, which include supermarkets and community ""Kirana stores,"" are critical to the wise expansion of India's tea business. India enjoys a prominent place in the worldwide export market as the world's second-largest tea producer. Russia, Iran, the United Arab Emirates, the United States, the United Kingdom, Germany, and China are the top tea-importing nations from India. Based on the product type, nearly half of the tea market has been occupied by Black tea in 2022 due to an increase in the number of tea drinkers around the world. The global tea market is segmented into various tea types including green tea, black tea, oolong tea, herbal tea, white tea and others. Among them, nearly half of the tea market has been occupied by Black tea in 2022. Black tea is made from the fermented leaves of the Camellia sinensis plant. These dried leaves and leaf buds are also used to make green and oolong teas. Black tea contains 2% to 4% caffeine, which affects thinking and alertness. It also contains antioxidants and other substances that might help protect the heart and blood vessels. People use black tea for improving mental alertness. It is also used for headache, both low and high blood pressure, preventing Parkinson disease, depression, dementia, stroke, and many other conditions, but there is no good scientific evidence to support many of these uses. People who regularly consume three or more cups of black tea per day have a reduced risk of heart disease and stroke. Additionally, those who drink a cup or more of Black tea per day have a 44% reduced risk of heart attack. Users who consume five cups of Black tea per day along with a diet moderately low in fat and cholesterol reduce their LDL cholesterol by about 11%. Additionally, Black tea reduced blood pressure, and among hypertensive subjects, it helped counteract the negative effects of a high-fat meal on blood pressure and arterial blood flow. Tea consumption has been linked to lower skin cancer risk. Consumers who drink iced Black tea and citrus peel have a 42% reduced risk of skin cancer and hot Black tea consumption is associated with a significantly lower risk of the most common form of skin cancer, squamous cell carcinoma. Black tea is also popular among health enthusiasts due to its high concentration of antioxidants and polyphenols. Vitamin C, zinc, iron, magnesium, copper, manganese, potassium, fluoride, and calcium are all present in black tea extract. In comparison to green tea, black tea extract contains more antioxidants and is anti-allergic, anti-viral, and anti-spasmodic. Based on the application, the residential segment accounted for a major share of the tea market in 2022 and is expected to grow at a significant CAGR during the forecast period. In many cultures, tea has a long history and plays a significant role in social and cultural traditions. It is often associated with rituals, ceremonies, and social gatherings. For example, in countries like China, Japan, India, and the United Kingdom, tea has deep-rooted cultural significance. Tea is often seen as a comforting and soothing beverage. It contains compounds like theanine that can promote relaxation and reduce stress. Many people enjoy a cup of tea as a way to unwind and relax at home. Tea is known for its potential health benefits. Certain types of tea, such as green tea, are rich in antioxidants and have been associated with various health advantages, including potential cardiovascular and weight management benefits. Many people consume tea at home with the belief that it is a healthier alternative to sugary or carbonated beverages. In colder regions, a hot cup of tea provides warmth and comfort during chilly or rainy days. It can help individuals stay cozy and combat the cold, making it a popular choice for residential consumption during the colder months. Tea is a hydrating beverage and can contribute to daily fluid intake. It's often chosen as a healthier alternative to sugary or caffeinated drinks for staying hydrated. It can be easily customized to suit personal preferences. People can adjust the strength, sweetness, and flavour of their tea by adding ingredients such as honey, lemon, sugar, or milk. This customization allows individuals to tailor their tea to their liking. Also, tea contains caffeine, but generally in lower amounts than coffee. This makes it a popular choice for those looking for a milder caffeine boost or wanting to avoid the excessive stimulation associated with coffee. Tea is also a means of social bonding and hospitality. Hosting guests or offering tea to family members and friends is a common practice in many cultures. Sharing tea at home fosters a sense of community and togetherness. Based on the distribution channel, the supermarket and hypermarket channels are experiencing significant growth in the worldwide tea market due to their vast product selections. The growth of the supermarket/hypermarket segment in the tea market is attributed to the increase in adoption of supermarket and hypermarket in both the mature and emerging markets. Moreover, the one stop solution provided by these retail formats makes it a very popular option for shopping for consumers. Furthermore, these retail formats offer a wide range of products at a competitive price to customers and are usually located at easily accessible areas. Consumers are able to satisfy all their shopping needs at these destinations, which also saves their time which further adds to the attractiveness of this segment. Unlike online platforms or e-commerce websites, this segment relies on consumers visiting physical locations to make their tea purchases. Offline channels are crucial in the tea market as they offer customers the opportunity to physically interact with the products, examine the packaging, and assess the quality of tea leaves or ingredients. This tangible experience instils consumer confidence and enables informed decision-making. Additionally, offline stores often provide sampling or tasting sessions, allowing customers to try different flavours and varieties of functional tea, facilitating personalized exploration and strengthening their purchasing choices. However, the online stores segment is estimated to grow at the fastest rate registering revenue of during the analysis timeframe owing to growing popularity of e-commerce platforms. Due to pandemic situation e-commerce platform has experienced the rapid growth and it is one of the fastest emerging sectors. Attractive discounts, coupons, cash-back offers, delivery service, and product variety offered by e-commerce platforms have attracted large number of customers. In addition, ease of placing an order, order tracking, cancellations & smooth refund process have gained huge popularity. Paperboard packaging is often preferred in the tea market being environmentally friendly, health-safety, light-protective packing material for foods and beverages, making it a leading choice for packaging tea products. Paperboard packaging is a popular choice for loose leaf tea brands. Paperboard, or cardboard containers, is the most popular packaging option for loose leaf tea brands. Paper has a lower impact on the environment than any other type of packaging because it contains no chemicals or undergoes chlorine treatment. Paper is also biodegradable, renewable, and recyclable. Paperboard acts as a strong barrier to moisture, gases, odours, and microorganisms. Paperboard is rigid, which allows stacking without container damage. Cardboard has the highest recyclable rates of all packaging materials. Research shows that 67% of consumers value sustainable packaging, and 74% are willing to pay a premium for it. Manufacturers often use paperboard packaging to convey an image of natural, wholesome, and traditional products. The natural look and feel of paperboard aligns well with the marketing and branding efforts of many tea companies. It can help create an appealing and authentic image for the tea brand. Paperboard packaging can be easily designed with features like re-sealable closures, tear-off tabs, and individual compartments for tea bags. These features enhance convenience for consumers, allowing them to store and transport their tea with ease. Many paperboard packaging designs include re-closable mechanisms, such as adhesive strips or re-sealable zippers. This ensures that the tea remains fresh after initial opening, which is a practical advantage for consumers. Paperboard packaging is often cost-effective and can provide good value for both tea manufacturers and consumers. The relatively low cost of production and printing can help keep overall packaging costs down. Market Drivers • Health and Wellness Trends: As more people become health-conscious, they are seeking beverages that offer both taste and health benefits. Tea, with its rich antioxidant content and various therapeutic properties, has become a go-to choice for many. Studies showcasing the potential health advantages of tea, such as its role in reducing the risk of chronic diseases, boosting immunity, and aiding in weight management, have fuelled this trend. Consequently, consumers are shifting towards herbal and specialty teas as they are perceived as healthier alternatives to sugary or artificially flavoured beverages. This growing awareness of the positive impact of tea on health is expected to continue driving the demand for tea products. • Increasing Urbanization and Busy Lifestyles: The rapid pace of urbanization and the increasingly hectic lifestyles of people worldwide have led to a growing demand for convenient and on-the-go beverage options. Tea, particularly in the form of ready-to-drink (RTD) products and tea-based beverages, has gained popularity as a convenient choice for urban consumers. This trend is fuelled by the need for portable, time-saving options that align with busy schedules. RTD tea products are readily available in various flavours and formulations, offering a quick and refreshing solution for those looking to satisfy their tea cravings while on the move. The shift towards urban living and the rise of busy lifestyles are thus propelling the tea market towards greater convenience and accessibility. Market Challenges • Price Volatility: The tea market faces a significant challenge in the form of price volatility. Several factors, including weather conditions, labour costs, and geopolitical events in major tea-producing regions, can influence the pricing of tea. This volatility affects both the cost of production and the retail prices that consumers are willing to pay for tea products. Unpredictable weather patterns, such as droughts or excessive rainfall, can harm tea crops and reduce yields, causing price fluctuations. Labour costs and labour disputes in tea-producing countries can also disrupt the supply chain, impacting prices. These challenges make it difficult for tea producers to maintain stable pricing and can sometimes result in increased production costs, affecting both the industry and consumers. • Competition from Other Beverages: The global beverage market is highly competitive, and tea faces fierce competition from various alternatives. While tea has a longstanding tradition and strong consumer base, it competes with popular beverages like coffee, soft drinks, and health-oriented options such as kombucha. The challenge lies in capturing and retaining market share in this competitive landscape. To thrive, tea companies must differentiate their products, cater to changing consumer preferences, and continually innovate to offer unique and appealing tea experiences. Adapting to evolving consumer tastes and trends is crucial in staying competitive in a market where consumers have a wide array of beverage choices. Market Trends • Premium and Specialty Teas: Consumers are increasingly seeking unique and high-quality tea experiences, moving beyond the basics of traditional black and green teas. This trend is driven by the desire for variety and exclusivity, with tea enthusiasts exploring rare tea varieties, single-origin teas, and artisanal blends. These premium and specialty teas are often associated with specific regions, unique flavours, and meticulous craftsmanship, offering a sensory journey that appeals to a more discerning and adventurous customer base. This trend reflects an evolving tea culture that places value on authenticity and craftsmanship, and it is likely to continue shaping the industry's future. • Sustainability and Ethical Sourcing: Sustainability and ethical sourcing have become prominent trends in the tea industry, reflecting consumers' growing concerns about the environmental and social impact of their purchases. Companies in the tea market are increasingly focusing on eco-friendly practices and ethical sourcing initiatives. This involves environmentally sustainable farming methods, responsible supply chain practices, and fair trade principles. Consumers are showing a preference for tea products that align with their values and support ethical and eco-conscious production. As a result, companies that prioritize sustainability and ethical sourcing in their tea offerings are not only meeting consumer expectations but also differentiating themselves positively in a competitive market. This trend emphasizes the tea industry's commitment to social and environmental responsibility, making it an integral part of its future growth and development. Covid-19 Impacts The COVID-19 pandemic has had a significant impact on the global tea market. While tea is generally considered a staple and a source of comfort for many, the pandemic introduced both challenges and opportunities. At the outset of the crisis, lockdowns, and restrictions disrupted the supply chain, affecting the transportation of tea leaves and causing delays in production. This resulted in short-term supply chain challenges and increased prices for some varieties of tea. However, as consumers adapted to new lifestyles and heightened health concerns, there was a surge in demand for tea, particularly in the form of at-home consumption. People turned to tea as a comforting and immune-boosting beverage, leading to increased sales of packaged tea products. The pandemic also accelerated the already-existing trend of e-commerce and online retail, allowing tea companies to reach consumers directly and mitigate the impact of physical store closures. Health and wellness-focused teas, like those with immune-boosting ingredients, became particularly popular. As the pandemic continues to evolve, the global tea market is likely to remain influenced by changing consumer behaviours and preferences, with health-consciousness and online channels playing an increasingly significant role in shaping the industry's future. Competitive Landscape The tea market is highly competitive, with strong competitors and a diversified product portfolio, which leads to intense competition among the existing players. The leading players in the tea market include Tata Consumer Products, Associated British Foods plc, The Hain Celestial Group, Inc., Starbucks Corporation, McLeod Russel India Ltd, Dilmah Ceylon Tea Company PLC, Lipton Teas and Infusions, Gujarat Tea Processors and Packers Limited, Ito En, Ltd., Barry's Tea, Apeejay Surrendra Group, Tim Hortons Inc.,, Wissotzky Tea, Harney & Sons, Organic India Limited, The Republic of Tea, Duncans Industries Ltd, Typhoo Tea Limited, DavidsTea and R.C. Bigelow, Inc. Consumers in the market are craving new and innovative products to accommodate their personal life. Companies are constantly trying to offer consumers new and innovative launches that meet their demands to capitalize on this trend. Key players have intensely embarked on the industry consolidation by leveraging their distribution network, entering partnerships with local distributors, especially in emerging economies, and developing new products. Most companies operating in the market engage in product innovation and R&D. They also focus on innovative advertising and social media campaigns to attract more target consumers. Tata Global Beverages entered into Ready-to-Drink segment with the introduction of green tea based drink, led by Tata Tea in India and Tetley in Canada. Key Developments • In November 2022, Dabur India Limited launched Dabur Vedic Tea, a premium black tea that contains 30+ ayurvedic herbs that provide health benefits and boosts immunity. The product contains herbs like Tulsi, Ginger, Cardamom, and others. • In November 2022, Tata Consumer Products expanded its green tea portfolio with the launch of Tetley Green Tea with tulsi flavor. Green tea improves immunity and is rich in vitamin C. • In July 2022, CVC Capital Partners Fund VIII completed the purchase of Ekaterra, the tea business owned by Unilever. A cash-free, debt-free sale of Ekaterra was agreed upon between Unilever and CVC in November 2021 for EUR 4.5 billion (USD 4.83 billion). • In June 2022, one of the leading North American tea retailers announced the launch of their new blend Manoomin Maple, created in collaboration with a women-led, indigenous-owned tea brand, Tea Horse. With a hint of maple, vanilla, and berries, this comfortable black tea mix is labelled as Manoomin Mapple and is available at all 18 of their flagship locations across Canada as well as online at davidstea.com. • In June 2022, TAZO and Deepti Vempati launched the #TAZOSummerBucketList giveaway in honour of National Iced Tea Day, giving away 2,500 bottles of TAZO iced tea for free and 20 prizes for the summer to fans. Considered in this report: • Geography: Global • Historic year: 2017 • Base year: 2022 • Estimated year: 2023 • Forecast year: 2028 Aspects covered in this report: • Global Tea market Outlook with its value and forecast along with its segments • Region & Country -wise Tea market analysis • Various drivers and challenges • On-going trends and developments • Top profiled companies • Strategic recommendation Regions & Countries covered in the report • North America (United States, Canada, Mexico) • Europe (Germany, United Kingdom, France, Spain, Italy, Russia) • Asia-Pacific (China, Japan, India, Australia, South Korea) • South America (Brazil, Argentina, Colombia) • Middle-East & Africa (UAE, Saudi Arabia, South Africa) By Tea Type: • Green Tea • Black Tea • Oolong Tea • Herbal Tea • White Tea • Others By Application: • Residential • Commercial By Distribution Channel: • Supermarkets/ Hypermarkets • Speciality Stores • Convenience Stores • Online By Packaging Type: • Paper Boards • Plastic • Loose Tea • Aluminium Tin • Tea Bags The approach of the report: This report consists of a combined approach of primary and secondary research. Initially, secondary research was used to get an understanding of the market and list the companies that are present in it. The secondary research consists of third-party sources such as press releases, annual reports of companies, and government-generated reports and databases. After gathering the data from secondary sources, primary research was conducted by conducting telephone interviews with the leading players about how the market is functioning and then conducting trade calls with dealers and distributors of the market. Post this; we have started making primary calls to consumers by equally segmenting them in regional aspects, tier aspects, age group, and gender. Once we have primary data with us, we can start verifying the details obtained from secondary sources. Intended audience: This report can be useful to industry consultants, manufacturers, suppliers, associations, and organisations related to the Tea industry, government bodies, and other stakeholders to align their market-centric strategies. In addition to marketing and presentations, it will also increase competitive knowledge about the industry.
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