Organic Tea Market: —
The global organic tea market is expected to grow from $0.85 billion in 2019 to $0.93 billion in 2020 at a compound annual growth rate (CAGR) of 10.00%. The coronavirus pandemic has led to a surge in the demand for organic and sustainable foods. This is because COVID-19 has driven consumer awareness about health and nutrition, and currently, organic foods that are free of pesticides or synthetic chemicals are viewed as safe alternatives. Organic tea has gained consumer attention as it has antioxidant properties that have significant positive effects on the body. However, the challenge is to maintain the supply with such a surge in demand. Therefore, the organic tea market is prone to supply-demand swings due to which the market growth is not as significant as expected. The market is expected to reach $1.15 billion in 2023 at a CAGR of 7.27%.
The organic tea market comprises of sales of organic tea products and related services. The market consists of revenue generated by establishments manufacturing organic tea products. Organic tea is a very popular beverage prepared using buds and boiling leaves obtained from Camellia Sinensis. It is free of herbicides & pesticides and synthetic fertilizers and has antioxidant properties.
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North America was the largest region in the organic tea market in 2019. Asia Pacific is expected to be the fastest-growing region in the forecast period.
In January 2020, Purity Organic, Inc., a leading organic food processor has acquired Dunn’s River Brands Group, Inc., a beverage processor with brands that include Sweet Leaf Tea and Tradewinds Beverage Co. Sweet Leaf Tea is an organic iced tea brand. Through this acquisition, Dunn's River Brands Group aims to continue to provide 'better-for-you' brands and expand into new areas.
The organic tea market covered in this report is segmented by type into green tea; black tea; white tea; oolong tea; herbal tea; others. It is also segmented by form into dried leaf; liquid; powder; others, by-product into paper pouches; cans; cartons; tea bags; others and by distribution channel into hypermarkets/supermarkets; convenience stores; online; specialty stores; others.
The high cost of organic tea in comparison with conventional tea is expected to hinder the growth of the organic tea market. The organic tea products are sold at a premium price. This is mainly because the cultivation of organic tea does not include any artificial chemicals, which increases the production cost. The organic certification process is very costly, which is also a factor that makes organic tea 10-15% more expensive than regular tea. Furthermore, the growing demand for organic tea or pesticide-free tea in the international market also affects the export price. Considering all these factors, the high cost is likely to challenge the growth of this market.
The manufacturers operating in the organic tea market are adopting various strategies such as new product innovations, mergers & acquisitions, and plant capacity expansion to expand their market share and global presence. For instance, The Tea Room Chocolate & Tea Company offers various organic tea-infused products such as a 60% dark chocolate bar infused with green tea, a white chocolate bar with honey and chamomile tea, and a 60% dark chocolate bar with raspberry rooibos tea. Therefore, the trend of infusing chocolate in tea is expected to add to the demand for organic tea.
Rising consumer awareness about the medicinal properties of organic tea is projected to boost the demand for organic tea over the forecast period. Organic tea, a very popular beverage prepared using buds and boiling leaves obtained from Camellia Sinensis, is free of herbicides, pesticides and synthetic fertilizers. It has antioxidant properties that have positive effects on the body. Organic tea contains a higher amount of catechins such as epicatechin, epicatechin gallate and epigallocatechin gallate as compared to conventional tea, and is claimed to be more beneficial to the human body. Moreover, the rich taste of organic tea is making it popular among individuals, increasing the consumption of tea in developed and developing economies. The changing consumer preference towards products manufactured from natural ingredients due to the health benefits that those products offer is expected to drive the organic tea market over the forecast period.
Major players in the organic tea market are Tata Global Beverages Limited, The Unilever Group, Organic India Private Limited, Associated British Food Plc., The Stash Tea Company, ESSAMG Tea Incorporation, Davidson's Organics, Harney & Sons Fine Teas (US), Halssen & Lyon GmbH (Germany), and Ambassador Organics.
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