The Big Picture of Tea

How much does tea cost?

As in, really cost? That was naturally one of the first things we researched. We expected to find a lot about estimating the quality, the soil, the craft etc. But no. Of course, this aspect exists, but it is not the norm of the industry.

Globally, tea is sold and bought like any other commodity. The production of the tea gardens is mainly sold in bulk in auctions. For example in India, the public tea auction system handles more than 500 millions kilograms annually. That is almost 1.4 millions kilograms every day! This is where the large brands get their tea.

A process dealing with such huge quantities will obviously involve many people and intermediaries, each taking a commission:. In fact, a 2019 study from the charity Oxfam estimates that in the UK, supermarkets and tea brands keep approximately 67% of the final consumer price. The rest is shared between the shipping companies, the brokers, the auction rooms etc, and oh, yes, the producers, whose staff gets about… 4%.

You read that right. Two thirds of the retail price remains within the big brands, and only 4% goes back to the people thanks to whom your tea exists.

How much is that, though? Let’s see: On average, and depending on the blend, black tea packs from first price brands are sold in supermarkets for £2 to £3.50. That is for a pack of 80 tea bags. For the sake of this discussion, let’s say £3 per pack. The supermarket and the tea brand will keep about £2. About 12p will go back to the tea workers.

This system keeps the producers in a state of economic uncertainty. Worse, the tea workers themselves often don’t earn enough to step out of the extreme poverty they live in. In order for final consumer to pay what is deemed an “acceptable” price, and for the big brands to maximize their profits, something has to give. And it is the producer and their staff, who are at the same time the most essential and the most vulnerable link in this whole chain, who have to bear the economic and human cost. For them, tea is too often a race to the bottom.

Surely, we could do better?

The good news is: yes, we can. We can have it both ways: ensuring that people are paid decently for the work they do, and that you, the consumer, will still pay a reasonable price.

To do so, we created a shorter chain, but with stronger links: Read on to discover what we do...

Darvaza Teas | Indian villagers picking tea

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