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Cost of tea expected to come down in 2010
Tea lovers can breathe a sigh of relief as tea prices, which reached record levels this year, are expected to ease in 2010. FAO, the United Nations Food and Agriculture Organization, says a key factor has been weather patterns, which returned to normal in the main tea-producing regions of Asia and Africa.
Traditional tea shop in Baghdad, Iraq.
The FAO Tea Composite price, the indicative world price for black tea, reached a high of $3.18 a kilogramme in September 2009, influenced by droughts in India, Sri Lanka and Kenya, as well as increased demand. In 2008, the average price of black tea was $2.38 per kilogramme.
Is tea consumption "habit forming"? Some say yes, due to the fact that demand for tea remained robust, despite the global recession. In developed countries, for example, higher tea prices have not affected the consumer because of intense competition in the beverages market. However in developing countries, manufacturers are likely to transfer a larger share of the price increase to consumers, as tea procurement costs account for a significant share of the final retail price.
Gerry Adams, United Nations.
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