Business Economics: The Tea Market

Business Economics: The Tea Market

Question 1

Tea, as the second most popular drink in the world after water, is a very important commodity for some of the developing countries in terms of jobs and export earnings, Dry tea is being marketing as "Black Tea" or "Green Tea" (Gulcubuk 2003)worldwide, The main difference between black and green tea is its processing style, Black tea is consummated in all countries in the world, The share of black tea in world tea production is 97%, Green tea is alike linden tree and it is especially cultivated in China and Japan and its share in world tea production is 3%.(Van der Wal 2008)

Tea agriculture and production is mostly performed on underdeveloped and developing countries in the world, Production is realized on averagely 25 countries with more than 1500 tea varieties, According to the FAO statistics, Turkey ranks sixth in the world production of tea after China, India, Sri Lanka, Kenya and Indonesia, Major tea producer countries are both the exporters except Turkey.

The consumption of tea in Turkey had been observed since l600s provided by the re-export of tea from European countries. Furthermore, first known experimentation about tea cultivation has been made in 1888 in Bursa with tea seeds brought from Japan. The possibility of tea cultivation in Turkey has been first determined by Ali Ryza Erten in 1917 around Rize province. However, cultivation of tea has been first started by a law in 1924. In the same year the Tea Research Institute has been established. Afterwards research studies have begun to be conducted and tea cultivation has begun on a commercial base. The distribution and processing of tea has been given to state authority in 1949. (Gesimba 2005)

China is the native country and the first cultivation place of the tea plant. In fact the origin of the tea agriculture in countries which are leaders on tea production is so new; for instance 1823 in India, 1824 in Sri Lanka.

Tea production in the world is realized on tropical and subtropical climates and regions on which precipitation is coordinate according to months and summers and winters are lukewarm. In addition to these facts, it also requires sour and humid land structure. (Gesimba 2005) In conjunction with the increase of tea cultivation and the evolution of tea processing in India and Sri Lanka, tea has been an important subject in the world trade. Tea agriculture has expanded to Southeast Asia and west ends of Asia (Turkey, Iran, and Russia) and South America later on.

Tea production areas are on the continent of Asia in the world. Tea harvested area is 2.545.416 ha on Asia continent as of 2009. Africa (257.820 ha), America (44.945 ha), Ocenia (7.000 ha) and Europe (1.045 ha) continents are following Asia continent successively. (Economic Intelligence Unit 2009)

The maximum tea production by amount is again performed on Asia continent with 3.267.436 tonnes in 2009. Africa (496.833 tonnes), America (97.315 tonnes), Ocenia (9.000 tonnes) and Europe (755 tonnes) continents are ...