February , 2020
Production of orthodox tea to increase export market
15:22 pm

B.E. Bureau

The Amalgamated Plantations, carved out of the Tata group, is one of the important players in the tea industry. Jagjeet Kandal, Managing Director, Amalgamated Plantations (APPL), spoke to BE’s Aritra Mitra.

Q. Tell us about the growth of your company?

A. Amalgamated Plantations is the second largest tea company in India. Apart from producing about 43 million kg of tea on our own, we also take a lot of leaves from small players. Almost 40% of our produce is from small players because in the last two decades they have become an important part of the supply chain. We are largely into selling dry tea. Presently, we are also looking into bringing in our own packet tea.

Q. Tell us about the export market and the export destinations?

A. We are already very export oriented. About 250 million kg of Indian tea is exported. We export around 9 million kg of tea. Almost 20% of our produce is orthodox and all of it is exported. I believe that Assam needs to focus on growing the orthodox category because globally, the cut, tear, curl (CTC) market for tea has been declining. In Europe, coffee and herbal tea are becoming popular. In the CTC category, we face competition from Africa because of its lower production cost. On the other hand, consumption of orthodox tea is increasing in the Middle East and Russia. We also face competition from orthodox Sri Lankan tea in Russian and Iranian markets. So, I think it is very important for Assam to increase its orthodox production by which we can increase our share in the export market and focus on better quality. In case of orthodox tea, West Asia and Russia are the two biggest markets. A small quantity of high value tea goes to Germany and Japan. Europe, USA, and Canada mostly constitute the CTC market.

Q. What are the offerings of your company?

A. We are bulk tea producers. Our range varies from the best to medium to the plainer categories and at different price levels. We also offer specialised tea like green tea, CTC tea, orthodox tea, organic tea and packet tea. We also have tea bags but it is a growing concept in India. Tata Global and Unilever are the leading players in this segment.

Q. Tell us about your focus on organic tea plantation?

A. We have one organic estate in the Kaziranga Wildlife Sanctuary as we do not want to pollute that area. However, it is very difficult because when everybody around is not organic and using chemicals, pests tend to come to our plants, which are being maintained organically. It is not very cost effective. However, we believe in it and so we are carrying on.

Q. Do you think that the online sale of tea has affected the offline market?

A. In case of special tea varieties, small quantities are sold online. At present, the quantity sold online is no competition for the offline sales.

Q. How do you look at the competition among different companies under the Tata group?

A. We are not in direct competition as the group is structured in that way. The type of tea we make in north India is different from the type we make in the south. Our customers, the price points and tastes are completely different. The only competition we face is in case of packet tea as Tata Global is the mother brand while the other brands also have a small part in the packet tea segment.

Q. How is your company focusing on the quality control measures?

A. We are one of the few companies who have our R&D department. We engage in tests and trials throughout the year to make our plantations and products better. We are leading when it comes to the use of technology.

Q. How is your company engaged in labour welfare policies and schemes?

A. We are focused on improving the living conditions and the status of our workers. We provide them with good healthcare. We have NGOs working on hygiene and nutrition projects with us and we also ensure that their projects in our estates directly impact the lives of our workers.

Q. How has the economic slowdown affected the tea market?

A. There are two things that have affected the tea market. One is the economic slowdown that has led to slow turnover. Oversupply of tea has also affected the market. The total production of tea has been growing every year and consumption is falling. We need to increase our export quantity so that the difference between supply and demand is balanced.


Add new comment

Filtered HTML

  • Web page addresses and e-mail addresses turn into links automatically.
  • Allowed HTML tags: <a> <em> <strong> <cite> <blockquote> <code> <ul> <ol> <li> <dl> <dt> <dd>
  • Lines and paragraphs break automatically.

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.