The Food and Agricultural Organisation (FAO) of the United Nations, headquartered in Rome, has urged the tea world to step up its efforts for expanding the demand for the beverage.

Observing that the medium-term projections suggest that the supply and demand of black tea will be in equilibrium in 2017 at a price of $3 per kg., FAO has said that caution needs to be exercised by the stakeholders in the world tea economy not to over-react to periodic price hikes. “Greater efforts should be directed at expanding demand,” the 23rd session of the FAO Intergovernmental Group on Tea recently held in China, observed.

Even if the output increases by five per cent, prices may crash by as much as 40 per cent in the next ten years, FAO has warned.

FAO’s document projects global black tea output to rise to 4,420 million kg (mkg) in 2027 from 3,333 mkg in 2017.

The global consumption of black tea is expected to rise to 4,168 mkg in 2027 from 3,291 mkg in 2017.

Likewise, the global exports of black tea are projected to increase to 1,658 mkg from 1,349 mkg last year.

If this total demand stands, there would be need for more tea in the market but if the demand falls, there would be unsold tea.

FAO has stressed that there is scope to increase per capita consumption in producing countries as the levels here are lower than in the traditional importing markets.

In India, for instance, per capita consumption is 786 grams against 1.3 kg in Russia, 1.2 kg in Pakistan and 1.1 kg in the UK.

Besides, it is imperative to address the ongoing declining consumption in traditional markets in Europe, FAO has stressed.

“Diversification into other segments of the market, such as organic and speciality teas, should be encouraged and the health and wellness benefits of tea consumption be used more extensively in promoting consumption in both producing and importing countries,” records the FAO document.

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