Tea exports grow, expanding the market share pie.
The tea industry is experiencing high growth due to lifestyle changes. However, tea products are also undergoing many changes to adapt to these lifestyles.
1 . The impressive growth figures
According to Mekong Asean, in January 2024, Vietnam's tea exports reached 12,398 tons, valued at over 21 million USD, a decrease of 9.7% in volume and 10% in value compared to the previous month but an increase of about 85% both in volume and value compared to the same period in 2023, according to data from the General Department of Customs.
The significant increase is mainly due to the low base in early 2023 and the good growth in tea exports in the last months of 2023. In terms of average export price, in January 2024, the average export price of tea from Vietnam reached 1,694 USD per ton, equivalent to the average export price in January 2023 but slightly decreased by 3% compared to the average export price for the whole of 2023.
Regarding export markets, in January 2024, Vietnamese tea was exported to 16 markets, a decrease of one market compared to January 2023 (Philippines), and a decrease of three markets compared to the whole of 2023, including the Philippines, Kyrgyzstan, and Kuwait.
Among them, Pakistan continues to be Vietnam's largest tea export market, accounting for 36.7% of the total volume and 43.7% of the total export value of the country, with 4,556 tons, equivalent to nearly 9.2 million USD, an increase of 33% in volume and 52% in value compared to the same period last year. Pakistan is also the market with relatively high average export prices (2,013 USD per ton), higher than the average export price of tea.
Second is the market of Taiwan (China). With a growth rate of about 87% in both volume and value of exports, reaching 928 tons, valued at nearly 1.4 million USD, Taiwan has risen one place in the ranking of Vietnam's largest tea export markets.
The third position belongs to the United States with a total tea export volume of 913 tons, equivalent to a turnover of over 1.2 million USD, an increase of 191% in volume and nearly double in value compared to the same period.
As the fastest-growing market among the top 5 tea export markets of Vietnam, China recorded a growth rate of 412% in volume and 145% in value, reaching 701 tons and over 1 million USD. However, due to the much higher increase in export volume compared to the increase in turnover, the average export price of tea to the Chinese market decreased by more than half compared to the same period, from 3,067 USD per ton to 1,469 USD per ton.
Meanwhile, according to the Ministry of Industry and Trade, the Import and Export Department (Ministry of Industry and Trade) citing data from the General Department of Customs, estimated that in February 2024, tea exports reached 8 thousand tons, valued at 14 million USD, down 35.5% in volume and 35% in value compared to January 2024, but up 17.6% in volume and 21.9% in value compared to February 2023.
In total for the first two months of 2024, tea exports are estimated at 20 thousand tons, worth 35 million USD, up 50.9% in volume and 53.5% in value compared to the same period in 2023.
The average export price of tea in February 2024 is estimated at 7,705.5 USD per ton, up 3.6% compared to February 2023. In the first two months of 2024, the average export price of tea is estimated at 1,698.6 USD per ton, up 1.7% compared to the same period in 2023.
Tea is one of Vietnam's Top 5 stored commodities in the world. In 2023, Vietnam's tea exports reached 121,000 tons, valued at 211 million USD, down 17% and 11% respectively compared to the same period last year. This is also the year with the lowest export volume in 7 years.
2 . Focusing on increasing productivity and quality
According to the Ministry of Industry and Trade, research from Research and Markets shows that the global tea market reached 24.3 billion USD in 2016 and is expected to reach 37.5 billion USD by 2025. The tea industry's growth is increasing due to lifestyle changes and increased consumer awareness of the health benefits of drinking tea.
Along with the high demand, tea products are also changing to fit into life. Premium home-brewed tea, health-beneficial tea, iced tea... are expected to lead the market in the coming period.
Experts believe that with the advantage of production, Vietnam has precious "green gold" resources. However, to grab a share of the 37.5 billion USD "pie," the tea industry needs to focus on improving productivity and quality. Investing in deep processing, especially high-quality post-processed tea products, to bring significant economic value to form an advanced tea processing industry in Vietnam.
In addition, it is necessary to develop a strategy to exploit thousands of years old tea forests in our country. This is a great advantage to create an image, build a premium tea brand for Vietnam.
A report from the Vietnam Tea Association earlier pointed out that the amount of tea consumed domestically is only one-third of the tea exported, but the value of domestic consumption is higher (about 352 million USD), as domestic consumption mainly consists of packaged specialty teas. This shows that not only the international market but also the domestic market has a high demand for premium tea products.
Quoting the story of the "four famous tea" including white tea, green tea, yellow tea, and black tea (produced from ancient Shan tea trees on the top of Suoi Giang mountain, Van Chan district, Yen Bai province), Minister of Agriculture and Rural Development Le Minh Hoan said that from one ancient tea tree growing in Suoi Giang, four different precious teas can be made. And the subject of this product is not only selling goods (dry tea buds) but also selling a story. Economic thinking is to sell differentiation.
The shift from agricultural production thinking to agricultural economic thinking; integrating multiple values in agricultural products lies here. Nowadays, people don't buy products anymore but buy how to create those products, including mindset, culture, stories, emotions during the product creation process. Therefore, whoever tells the most emotional story through the product will win. This is also a way to increase the value of Vietnamese tea plants.
