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Organic Tea Market Size, Share & COVID-19 Impact Analysis, Type (Black Tea, Green Tea, and Others), Form (Tea Bags, Loose Leaves, Loose Powder, and Ready-to-drink), Distribution Channel (Supermarkets/Hypermarkets, Convenience Stores, Specialty Stores, and Online Retail), and Regional Forecast, 2020 – 2027

Region : Global | Format: PDF | Report ID: FBI100804

 

KEY MARKET INSIGHTS

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The global organic tea market size was USD 820.8 million in 2019 and it is projected to reach USD 1,918.7 million by 2027, exhibiting a CAGR of 11.2% during the forecast period.


The global market for organic tea is showcasing strong growth principally because of the growing knowledge regarding safer counterparts of organic products among consumers. The growing perception that clean-label products are safe, as well as healthy, has increased the demand for organically grown tea to maintain overall health and wellbeing. The emerging trend of healthy hydration has considerably increased the demand for ready-to-drink nutrient-enriched specialty teas among consumers. These trends have led the key manufacturers to launch organic variants of a range of specialty teas such as green tea, herbal tea, and organic black tea.


Disturbance in Organic Tea Production during COVID-19 Pandemic to Slow Down Growth


The tea industry has witnessed a strong rise in both consumption as well as prices despite the COVID-19 pandemic situation. Restrictions on farming activities in the preliminary phases of the lockdown to reduce the effect of the pandemic had impacted tea production in tea producing countries such as China and India.


According to The Economic Times, India, in the first seven months of 2020, the tea production in India has been unfavorably impacted with an estimated decline of around 22 percent than that of the previous year. Tea manufacturers across the world have been significantly affected by the COVID-19 pandemic, primarily due to nationwide lockdowns and social distancing policies. Imports and export restrictions created uncertainty in the tea market, leading manufacturers to undertake emergency measures to maintain the demand and supply ratio. However, the increase in the popularity of at-home consumption has increased the retail sales of tea bags during the pandemic which is expected to drive market growth in the upcoming years.


LATEST TRENDS


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Surging Consumer Preference for Buying Organic Commodities is a Prominent Trend


Organic products are gaining popularity as mainstream products among consumers. These products have become a lifestyle trend for consumers due to the growing perception that organic products are healthier, as compared to conventional ones. Organic food products are rapidly gaining recognition among consumers due to the emerging trend of consuming naturally sourced and chemical pesticide-free products. Food safety is becoming a crucial factor among consumers while buying food. Organic food is naturally grown without using chemical fertilizers which makes it safer than conventional food products. The growing consumer inclination towards safety certified food products drives the demand for organically grown foods. The emerging trend of naturally and clean-label healthy beverages is expected to facilitate the organic tea market growth across the globe.


DRIVING FACTORS


Growing Knowledge Regarding Healthfulness & Safety of Organic Products to Fuel Growth


Consumer awareness regarding clean-label foods such as pesticide-free commodities primarily drives the growth of the market across the globe. In the past few years, organic tea production has considerably increased due to the perceived higher quality of organically grown tea along with the benefits for environmental and human wellbeing. Furthermore, organically grown tea sales are expected to have better price realization and uplift the socio-economic condition of tea producers. The growing awareness regarding food safety and rising demand for organic food and beverages in the global market has led to advancements in organic farming in various regions of the world.


Organically grown tea contains a higher amount of catechins such as epicatechin, epicatechingallate, and epigallocatechin gallate as compared to conventional black tea. The increasing health consciousness of consumers regarding the healthfulness of organically grown tea against the harmful effect of conventionally produced tea boosts its demand in countries such as the U.S., Japan, Germany, and other European countries.


Increasing Demand for Specialty Teas to Fuel Growth


Modern-day tea consumers are actively seeking high-value specialty teas due to the emerging trend of natural, clean-label, organic and healthful products. Consumers are also more aware of tea varieties and origin and seek an authentic experience while drinking tea. Millennials actively search for healthy teas, which has necessitated manufacturers of innovative tea blends, flavors, and ready-to-drink teas.


The increasing knowledge of the healthful characteristics of organically grown tea would significantly contribute to the rising demand for organically grown tea. Sustainability has become a popular trend in the developed market of North American and European markets, which is expected to drive the growth of the organically grown tea market in the foreseeable years.


RESTRAINING FACTORS


Constraints in Organic Tea Production Act as a Key Restraint for Market Growth


The lack of knowledge regarding proper farming practices for the production of this tea acts as a major restraint for the market growth. Tea growers generally lack the expertise to convert their conventional farming systems to become more productive and sustainable. Furthermore, the production cost of this tea is comparatively higher than that of the conventional one, which hampers the growth of the market.


The certification process involved in organic tea production and sales in the international market is very expensive. The access to certification cost involved and the time lag of three years often restrict farmers from adopting organic farming. However, increasing efforts by the government to spread awareness regarding advanced agricultural practices among farmers are anticipated to reduce these constraints and support the growth.


SEGMENTATION


The global market is segmented by type, form, distribution channel and region.


By Type Analysis


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Black Tea Segment Holds Largest Share Owing to its Higher Production & Wider Availability


Black tea is widely consumed as black tea production is higher than those of other tea types. It is the highest in Asian countries such as China, India, and Japan. Traditionally, black tea has been consumed more owing to its known health benefits such as a higher amount of antioxidants. Consumers are increasingly choosing black organic tea due to the growing awareness regarding safer counterparts of organically grown teas, as compared to the conventional ones. The rising demand for clean-label and natural products is expected to boost the market growth in the foreseeable years.


The green tea segment is the fastest-growing segment due to its rising popularity among consumers attributed to its various health benefits. Green tea is becoming a mainstream segment due to its higher antioxidant and flavonoid content. It is gaining more popularity among consumers for weight management, detox, and boosting immunity.


By Form Analysis


Tea Bags Segment to Generate the Largest Share Stoked by its Easy Storage & Portability


The growing popularity of convenience and portable food & beverages has contributed to the strong growth of the organic tea bags segment across the globe. Teabags form holds the largest organic tea market share due to its easy preparation process. The emerging trend of on-the-go healthy hydration and ready-to-drink beverages has substantially facilitated the growth of the tea bags segment worldwide. Consumers nowadays seek innovative flavors in a range of organic tea types. The availability of tea bags for such different flavors allows consumers to carry assorted tea types along with them, enabling them to consume these teas on-the-go.


The food packaging industry worldwide is developing rapidly due to ongoing research, development, and innovations. Food grade packaging is a novel packaging type that ensures the safety of packaged foods. The growing utilization of food-grade tea bags has enabled organic tea manufacturers to capitalize on the modern consumer trend of safe packaging. The growing availability of diverse flavors of these teas in teabag form is expected to fuel the growth of the segment in the foreseeable years.


By Distribution Channel Analysis


Broader Accessibility of Products to Promote Supermarket/Hypermarket Segment


The supermarket/hypermarket channel is showcasing the strongest growth owing to the wide range of products these stores offer. The advancements in storage procedures have enabled these stores to offer comfort to purchasers which leads to an easy shopping experience. The investors are focused on investing in the adoption of modern equipment on the floor that helps retailers to provide quality products to consumers. The dominance of mass merchandisers viz. supermarkets/hypermarkets in the organically grown tea market are however being taken up by rapidly growing online retail platforms due to the extensive product portfolio and convenience of delivery they offer.


REGIONAL INSIGHTS


North America Organic Tea Market Size, 2019 (USD Million)

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North America is the Leading Region while Asia Pacific is the Fastest Growing


The North America market is exhibiting robust growth due to some emerging trends such as consuming natural, safe and clean-label products. Consumers in the region are becoming more aware regarding the safety and ethnicity of healthy food they choose to consume. The trend of functional organic beverages in the U.S. and Canada drives the growth of the market in North America. The growing focus on the development and launch of innovative organic tea variants in novel packaging is expected to boost the regional market growth during the forecast period.


The Asia Pacific market is showcasing substantial growth owing to the increasing discretionary incomes among consumers in the region. Consumers in countries such as China, India, Japan, and Indonesia have now started spending more on healthful products. The growing popularity of green tea and herbal tea to improve beauty and health is primarily fuelling the market growth in the region. This tea is perceived to be healthier as compared to conventional tea variants. The rapid expansion of the food and beverage industry in the region has also significantly contributed to the market growth in Asia Pacific.


The European market is primarily driven by the growing demand for specialty teas among consumers. Organically grown green and herbal teas are becoming mainstream in the European retail market. The emerging trend of sustainably grown and ethically traded teas in the region is expected to further boost the growth of the tea market. Modern day hectic lifestyle of consumers is triggering the growth of the organically grown tea bags segment in European countries such as the U.K., Germany, and France.


The South American market is expected to exhibit significant growth owing to the growing knowledge regarding the safety of organic products among consumers. Organic green tea is becoming mainstream due to the increasing consumer interest in green teas to improve overall health. The surging demand for innovative forms and varieties of organically grown teas is projected to boost the demand for novel flavors of organically grown teas in the market.


The market in the Middle East and Africa is anticipated to be driven by the increasing discretionary income levels and growing interest in healthier products. The manufacturers have tremendous growth opportunities with the introduction of cost-effective organic tea varieties.


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KEY INDUSTRY PLAYERS


Typhoo is Intensifying Market Presence by Launching Innovative Tea Variants


Typhoo, a major British tea brand, is investing in the research and development of innovative tea variants that fit modern consumer demands of natural, herbal, and clean-label products. For instance, in March 2020, the company expanded its organic herbal tea portfolio with the addition of three new variants, purifying super green, digestive power seeds, and immunity-boosting three teas.


The global market is moderately consolidated. Few multinational companies including Tata Consumer Products, Associated British Foods, and The Bigelow Tea Company dominate the market worldwide. The leading companies are focused on launching innovative products, strategically acquiring and partnering with established key players, and expanding their production capacities to facilitate consolidation in the market.


LIST OF KEY COMPANIES PROFILED:



  • Associated British Foods plc (London, U.K.)

  • Unilever plc (London, U.K.)

  • Tata Consumer Products Limited (Mumbai, India)

  • The Bigelow Tea Company (Connecticut, U.S.)

  • The Republic of Tea, Inc. (California, U.S.)

  • The Stash Tea Company (Oregon, U.S.)

  • Tazo Tea Company (Washington, U.S.)

  • Shangri La Tea Company (Nevada, U.S.)

  • Newman’s Own, Inc. (Connecticut, U.S.)

  • Organic India Pvt. Ltd. (Lucknow, India)


KEY INDUSTRY DEVELOPMENTS:



  • October 2019- Yogi Tea announced the acquisition of a leading company, Choice Organic Teas. This acquisition has enabled the company to expand its presence in the market.

  • September 2019 – East West Tea Company has acquired a leading brand Choice Organic Teas. This acquisition will enable the company to expand its presence in the global market.


REPORT COVERAGE 


An Infographic Representation of Organic Tea Market

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The market research report provides a detailed analysis of the market and focuses on key aspects such as leading companies, product forms, and leading distribution channels of the product. Besides this, it offers insights into the market trends and highlights key industry developments and competitive landscape analysis. In addition to the aforementioned factors, the report encompasses several factors that have contributed to the growth of the market over recent years.


Report Scope & Segmentation:














































  ATTRIBUTE



  DETAILS



Study Period



  2016-2027



Base Year



  2019



Forecast Period



  2020-2027



Historical Period



  2016-2018



Unit



  Value (USD million)



By Type




  • Black Tea

  • Green Tea

  • Others



By Form




  • Tea Bags

  • Loose Leaves

  • Loose Powder

  • Ready-to-drink



By Distribution Channel




  • Supermarkets/Hypermarkets

  • Convenience Stores

  • Specialty Stores

  • Online Retail



By Geography




  • North America (By Type, Form, Distribution Channel, and By Country)

    • USA (By Type)

    • Canada (By Type)

    • Mexico (By Type)



  • Europe (By Type, Form, Distribution Channel, and By Country)

    • U.K. (By Type)

    • Germany (By Type)

    • France (By Type)

    • Italy (By Type)

    • Spain (By Type)

    • Rest of Europe (By Type)



  • Asia Pacific (By Type, Form, Distribution Channel, and By Country)

    • China (By Type)

    • India (By Type)

    • Japan (By Type)

    • Rest of Asia- Pacific (By Type)



  • South America (By Type, Form, Distribution Channel, and By Country)

    • Brazil (By Type)

    • Argentina (By Type)

    • Rest of South America (By Type)



  • Middle East & Africa (By Type, Form, Distribution Channel, and By Country)

    • South Africa (By Type)

    • UAE (By Type)

    • Rest of the Middle East & Africa (By Type)





Frequently Asked Questions

Fortune Business Insights says that the value of the market was USD 820.8 million in 2019 and is projected to reach USD 1918.7 million by 2027.

In 2019, the North America market value stood at USD 262.6 million.

Registering a CAGR of 11.2%, the market will exhibit steady growth in the forecast period (2020-2027).

Based on type, the black tea segment is expected to lead the global market during the forecast period.

The rising popularity of clean-label products is the key factor driving the market.

Unilever plc, Tata Consumer Products Limited, and Associated British Foods plc are the top players in the global market.

North America is expected to hold the highest market share in 2019.

The rising awareness of health benefits of antioxidants and the growing popularity of functional beverages are expected to drive the adoption of organic tea.

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Organic Tea Market  Size, Share and Global Industry Trend Forecast till 2026
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