Impact of West Asia Crisis on Assam Tea Exports
Consequences of the West Asia Crisis on Assam's Tea Industry
Guwahati, June 26: The ongoing crisis in West Asia poses a significant threat to Assam's tea exports, potentially leading to disruptions that could upset the balance of supply and demand in the local market.
Countries in West Asia, including Iran, Iraq, Qatar, Saudi Arabia, and the UAE, collectively import around 90 million kilograms of Indian tea, which constitutes approximately 35% of the nation's total tea exports.
Notably, around 9% of Assam's tea production consists of orthodox varieties, with a large portion being exported, particularly to Iran.
Experts warn that a decline in exports could lead to an oversupply of tea in the domestic market, resulting in a mismatch between demand and supply, which would adversely affect farm gate prices.
“Iran alone accounts for about 20% of India's tea exports. Thus, the current situation in Iran is likely to impact the Indian tea sector. Iraq also plays a crucial role as a market for Indian tea. Furthermore, 9% of Assam's total tea production is orthodox, with Iran being a key destination for this variety,” stated Bidyananda Barkakoty, an advisor to the North Eastern Tea Association (NETA).
Barkakoty emphasized that approximately 15% of India's tea production is exported, and any disruption caused by the West Asia crisis would negatively affect Assam's tea industry, which is responsible for about 50% of the country's tea output and provides livelihoods for millions.
This situation threatens to reverse India's recent achievement of becoming the world's second-largest tea exporter in 2024, surpassing Sri Lanka.
Data from the Tea Board of India indicates that the country exported an impressive 255 million kilograms of tea in 2024, reflecting a notable 10% increase in export volume.
Tea exporters have already experienced disruptions in shipments to Iran due to the ongoing conflict, with premium orthodox tea exports valued at over Rs 150 crore being affected.
India exports tea to more than 25 nations, with the UAE, Iraq, Iran, Russia, the USA, and the UK being its primary markets, making it one of the top five tea exporters globally, accounting for about 10% of total world exports.