Vietnam and global tea market

The Micro and small household segment remains the primary source of supply. Reports indicate that tea is becoming less attractive to farmers, with one of our suppliers losing access to a significant green leaf source due to farmers switching to Acaccia wood. Initial indications suggest new season green leaf prices at USC 17 per kg, possibly influenced by shipment deadline pressures.

Despite media claims that Pakistan restricts the import of dyed tea, there is still a significant import volume from Vietnam even after the relaxation of the ban. The ongoing foreign currency shortage in Pakistan has hindered many importing businesses from obtaining the necessary funds for payments to exporting companies.

The Taiwan market is experiencing a slowdown in 2023, anticipating its slowest growth in decades. This deceleration is attributed to a declining export trend, set against a backdrop of globally high interest rates aimed at combating inflation.

The Russian market faces challenges, primarily driven by (1) increased in-land import costs amid political complications and conflicts, and (2) rising inflation and a weak currency. These factors may lead the Central Bank of Russia to raise interest rates and implement stricter monetary policies, constraining consumer demand in the country.

China’s tea purchases in the first eight months of 2023 have decreased due to the challenges associated with exporting to Russia.

Argentina may encounter obstacles in tea exports in 2024, potentially triggered by political changes that could escalate the cost of production. In such a scenario, we anticipate buyers sourcing more from other countries, including Vietnam. We remain vigilant and adaptable in navigating the dynamic global market landscape to ensure the continued quality and availability of our tea products.