Value Chain
 

Millions of people are employed in the tea sector worldwide. The production and export of tea is vital to the economies of producing countries in providing livelihoods for communities in remote and poor rural areas. But while world tea production doubled over the past 3 decades, demand is lagging behind, creating a situation of oversupply. This is one of the key reasons for continuous low prices for tea producers. The other reason is uneven value distribution. The tea supply chain tends to be complex, with many actors, producers, collectors, traders/brokers and packers involved. However, the buying and retailing end of the market is dominated by a handful of powerful multinational companies that are in a strong negotiation position and are able to skim off most of the value in the chain. Together structural oversupply and uneven value distribution demand a heavy toll at the beginning of the tea value chain.

 

In this value chain a wide range of stakeholders and activities are involved in transforming the leaves on a tea bush to the beverage in a consumer’s tea cup. Likewise, transforming the tea industry into a sustainable economic sector presents an extraordinary challenge to all its stakeholders. Cooperation between producers, NGOs, governments, traders, processors and retailers is necessary to improve the working and living conditions of people involved at the beginning of the tea value chain.