迈克尔·巴斯顿：Good morning Ladies and Gentlemen and let me say how grateful I am to The People’s Government of Henan Province for inviting me to address the Jigongshan International Tea Summit, in this beautiful part of China.

Let me introduce myself. I am the Chairman of the International Tea Committee and count the majority of Tea Producing Countries and a number of Consuming Countries as our Full Members.

China has four members, The Chamber of Commerce as full members, China Tea Marketing Association as Associate Members and China Tea Company Ltd and VIVA Tea Industries Co Ltd as Corporate Members. So as you can see China is well represented and rightly so as you are the Largest Tea producers and the biggest consumers in the world.

The ITC is the Official World Statistical body on tea and in recent years has played a part in bringing together all its members to discuss the issues that are important and relevant to the Tea Industry today.
We are looking at ways of being more pro-active on certain aspects of the Industry, and we have a meeting in London next week in order to address this. The main topic will be sustainability and what can be done to mitigate the effects of climate change, which is now an important part of all our lives. I will come back to this later.

Firstly, as we are primarily a statistical body, I want to give you a few statistics.
PER CAPITA CONSUMPTION BY CONTINENTS.The world population is now over 7 billion and the average tea consumption is currently just over half a kilo per head.Asia & The Far East account for 68% of this consumption. The Middle East accounting for 6%, although per capita consumption is higher.Over 20% of the world imports are absorbed by Asia and Far East alone, in addition to the 45% of supply that is retained for consumption in India & China. Never the less per capita consumption is relatively low at only 610 gms. However with 59% of the world’s population the potential for growth is considerable.

There is an interesting comparison between the CIS Region, where total population is 271 million and a per capita consumption of 910 gms, but within Europe it is only 486 gms for a population of 510 million, and bear in mind that this figure includes the UK and Ireland, where consumption is still one of the highest at 2.2 kg per head of the population.

The highest growth in population over the last 50 years has taken place in Africa. They now have a population of over 1 billion, with the majority still very young and although their per capita consumption is only a modest 290gms, this is a significant increase where tea was not a familiar beverage. Clearly there is considerable potential for an increase.

Looking at North America, a region more renowned for coffee consumption, tea now stands at 390 gms per capita, imports having grown by 20% over the past 10 years.

REGION-WISE CONSUMPTION BY TYPE.

Consumption of Green Tea in China has increased from 24% of global crop to 32% within the last 10 years. With this influence coupled with increased production of Oolong, Pue’rh and other teas, worldwide consumption of black tea has declined to approximately 60% of world crop, compared to 70% in 2000.

With the increase of growth within China, a larger proportion of green tea is produced and consumed internally. Consumers in Japan and Morocco have historically been green tea drinkers and there is now more interest in green tea in the USA which has boosted imports to 15% of total tea imports.

Tea being relatively in-expensive has always been considered recession proof and the difficult economic times being faced generally should not affect consumption too seriously, but with difficult weather conditions being experienced in some producing countries and a subsequent decline in crops, prices have moved up and this might meet some resistance with consumers. It is also apparent that some packers are working on reduced stocks.

PRODUCTION 2005-2009.

2009 PRODUCTION. This slide shows global production in 2009, with China & India accounting for virtually 60% of the total.

On this graph we see percentage shares of world production for the major tea producing countries over the past 5 years. You will see that there has not been a great deal of change, with the exception of China and Vietnam.
Interestingly, last year, with India having a good finish to their season after a slow start and China maintaining their momentum, despite droughts in Kenya and Sri Lanka, global production in 2009 was similar to 2008.

Since 2005, world crop has increased by 12%. The main gains have come from China and Vietnam, with China growing by 40% and Vietnam by approximately 15% during this period. The other main producing countries have had variable production but figures have remained broadly the same with only Indonesia showing a decline of 15% due, it is thought, to some producers moving away from tea.

So to sum up production generally has shown little change with the exception of China whose share of global production has increased to 34% compared to 27% in 2005.

ANNUAL AVERAGE PRICE at AUCTION 2004-2009

Having looked at the pattern of consumption and production, let us now look at the all important price trends.
Since 2003 we have been gradually getting used to price increases, and there are a number of factors which have influenced this:

Inconsistent weather patterns, leading to irregular supplies is probably the main factor.

The increasing affluence of developing countries and subsequent higher disposable incomes has lead to greater demand.

Bear in mind, also that tea has been very reasonably priced for some years and so there has been room for an increase. However the other side of the coin is the rising cost of production and transport costs with the higher oil prices.

Looking at this chart we see that the average price for Ceylon Tea in Colombo has increased to US$ 3.22 from $1.78.

Taking the Indian Auction Centres the increase has also been considerable with Kolkata at US$ 2.54 up from $1.77. The others have also experienced similar rises.

Indonesian Teas in Jakarta currently stand at US$ 1.85 up from $1.02, while in Mombasa the all tea average is currently US$2.29 compared with $1.55 five years ago.

We are witnessing climate change as a reality all around us.

Greater disposable incomes enjoyed by a world that is showing rapid development coupled with population growth concerns economists about food and land security. We are told that we are increasing carbon emissions while reducing the planet’s capacity to absorb carbon.

The good news is that tea is virtually carbon neutral at the point of production. Of course we can do more to improve the situation by reducing the use of some pesticides and herbicides, growing more trees for wood to fuel boilers and tea driers.

One interesting aspect of tea marketing and delivery which calls out for improvement is the movement of the crop after production.

Until 1998 Tea Auctions were conducted in London where vast quantities were traded, the majority for local consumption but a considerable quantity was re-exported. Mainly due to containerisation but also the desire by Producers to auction their own teas, the need for such a centre became unnecessary and un-economical. Packing plants have been created near to where they are required to serve a particular market. Unilever now have many such plants throughout the world and recently Twinings, who have a very large export market, made a decision to reduce their capacity in the United Kingdom and place their packaging for other markets in Poland and Japan. It must make sense not to have a situation where you import teas from China blend & pack them in the United Kingdom and then ship them back to Japan and other destinations far away. Although such decisions are usually made for commercial reasons it is also important that it will reduce the use of unnecessary fuel and other contributors to the carbon footprint.

It is likely that this trend will continue and already in the speciality range, teas are often packed at origin and sent directly to their markets.

China introduced tea to the world centuries ago and much has happened since, but the changes worldwide in the past 50 years have been quite dramatic, not least in China, where last year when I visited Sichuan Province, I saw work being done on organic pest control and at the same time the most modern tea processing factories imaginable. No doubt further advancements will be made to what is the most widely consumed and enjoyed beverage, with its proven health benefits and contribution to reduction of carbon emissions.

Ladies and Gentlemen, thank you for your kind attention.