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News18
12 hours ago
- Business
- News18
Crisis Brews For Premium Orthodox Assam Tea As Israel-Iran Conflict Hits Exports
Last Updated: Iran is a key destination for Assam's orthodox tea, accounting for nearly 25 million kilograms—approximately 30%—of the state's annual orthodox tea production of 85 million kgs At a time when Assam's tea industry continues to garner global recognition, the ongoing geopolitical conflict between Iran and Israel has emerged as a potential disruptor, casting a shadow over the state's vital orthodox tea exports—particularly to Iran, one of its largest and most loyal markets. Market Under Threat Iran is a key destination for Assam's orthodox tea, accounting for nearly 25 million kilograms—approximately 30 per cent—of the state's annual orthodox tea production of 85 million kilograms. This figure is particularly significant, considering that Assam exports around 140 million kilograms of tea globally, over half of India's total export of 260 million kilograms. However, in the wake of the Iran-Israel conflict, this critical export channel has entered uncertain waters. According to Prabhat Bezbaruah, former chairman of the Indian Tea Board and a leading voice in the industry: 'With the present situation in the Middle East, this market is now at serious risk." In 2024, India exported 35 million kg tea to Iran, whereas the export quantity to Iraq was 40.47 million kg. The export in Kolkata auction slipped by 59 per cent, while in the same time, the export at the Guwahati Tea Auction centre came down by 41 per cent. Prices of orthodox tea to Iran at Kolkata Auction was 307.34 kilogram and at Guwahati was 269.53 rupees per kilogram. Post-war, the prices came down by 24 per cent at the Guwahati auction itself. 'It's premature to predict. The export to Iran is a process which involves the government. The registration works needs to be done and then comes the payment process. Registration is time-bound and there is a huge amount as outstanding payment now. The ships have been docked for the past one week," said Anshuman Kanoria, president, All India Tea Exporters Association. Unlike other destinations, tea exports to Iran operate under a government-controlled system that includes time-bound registration of contracts followed by delayed payment schedules. While the tea for this season has already been shipped or is awaiting dispatch within a week, delays are expected. Outstanding payments remain a concern for exporters, increasing the financial burden on producers. Current orders are still in hand, and while shipments have not come to a complete halt, uncertainty is looming large over future contracts. The silver lining in the crisis is that demand from Iran remains strong, and outlook for future orders is positive—if political stability returns soon. However, with ongoing instability, exporters are wary of risks. Prices have already taken a major hit, falling 10 to 20 per cent across different grades, with premium orthodox teas being the hardest hit. Bezbaruah warned, 'The price of orthodox tea, which had climbed to Rs 50–60 per kg, has already fallen by Rs 100 in some segments. This kind of decline is unsustainable." Assam orthodox tea is primarily auctioned at the Kolkata Tea Auction which also deals with orthodox tea from down South. Impact Beyond Iran The Middle East war's effect is spilling over into broader markets. Iraq, which has emerged as the major secondary destination for Iran-specific teas these days, is absorbing some of the volumes meant for Iran. However, medium-quality teas have been most affected, with a noticeable dip in sales and product coming back unsold into the domestic market. 'The problem with the Iran-specific orthodox is the mid-range. This tea is impacted as the sale percentage has come down drastically," highlighted Kanoria. However, exporters are cautiously optimistic and willing to take the risk of continued exports—particularly of orthodox Assam and South Indian teas. Diversifying Through Compliance and Channels While orthodox teas face geopolitical and financial headwinds, dust teas—used mainly for tea bags—have fetched record prices this season. This is largely due to 100 per cent compliance with EU standards for pesticide and Maximum Residue Limits (MRL), a longstanding issue for many tea-producing regions. The focus on diversified channels and strict compliance is seen as a potential buffer against declining demand in volatile markets. Climate Change & Economic Pressures Geopolitics is only one layer of Assam tea's complex crisis. The industry is grappling with climate change, where June temperatures have exceeded 38°C—well beyond the ideal 35°C—and erratic rainfall is disrupting the crop cycle. Also, operational costs remain high, adding to the woes of the industry. First Published: June 25, 2025, 15:49 IST News india Crisis Brews For Premium Orthodox Assam Tea As Israel-Iran Conflict Hits Exports
United News of India
13 hours ago
- Business
- United News of India
Orthodox Tea markets rebound as India-Iran trade recovers post ceasefire
Guwahati, June 25 (UNI) The return of calm in the Middle East following the 12-day war between Iran and Israel has brought a wave of relief for Indian orthodox tea exporters. With Iran being one of the largest buyers of premium Indian tea, the ceasefire has helped stabilise auction markets across the country after two weeks of uncertainty and losses. During the conflict, tea exports to Iran came to a virtual halt, triggering panic in major auction centres such as Kolkata and Guwahati. Traders reported a 10% dip in sales of orthodox tea, a premium variety especially popular in Iran. The escalation had also disrupted logistics, with consignments getting held up at ports like Nhava Sheva and insurance concerns compounding the problem. Now, with the ceasefire in place, normalcy is returning to the Indian tea trade. Exporters are resuming shipments and auction prices are beginning to rebound. 'Exporters were deeply concerned about the situation in Iran. A majority of our orthodox tea exports—especially from Assam—are destined for Iranian markets,' said Anshuman Kanoria, Chairman of the Indian Tea Exporters Association. 'But with the ceasefire, tea traders have returned to the auction centres and are shifting their focus back to orthodox tea from CTC.' According to Kanoria, Iran imported over 35 million kilograms of orthodox tea from India last year, primarily from Assam, with average prices ranging between Rs 300 to Rs 325 per kilogram. Despite the recent disruption, exporters now expect prices to improve to around Rs 350 per kilogram, thanks to renewed demand from Iranian buyers. India's overall tea exports touched 254.7 million kilograms in 2024, an increase of nearly 10% over the previous year. Of this, orthodox tea accounted for around 120–130 million kilograms, with Iran alone consuming more than a quarter of it. The value of Indian tea exports to Iran stood at approximately USD 40 million in 2024, according to UN trade data. Kanoria attributed Iran's strong preference for Indian tea to deep-rooted cultural ties and a long-standing appreciation for the flavour profile of Indian orthodox varieties. 'This is a people-to-people business. The love Iranians have for our tea goes beyond politics,' he said. Industry insiders believe that while geopolitical tensions in West Asia are likely to remain a concern, the resilience of this trade relationship gives Indian exporters confidence of moving forward. 'Tea is not just a commodity—it's a cultural bridge. And Iran continues to be one of our most valued partners in that regard,' Kanoria added. With shipments resuming and confidence returning among traders, India's tea sector is once again steeped in optimism. UNI XC RN
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Business Standard
13-06-2025
- Business
- Business Standard
Israel-Iran tensions cloud India's tea export prospects in West Asia
Strong demand has lifted orthodox tea prices but exporters worry as Israel-Iran flare-up threatens disruptions in key West Asian markets like Iran and Iraq Ishita Ayan Dutt Kolkata Listen to This Article Robust demand from West Asian markets — particularly Iran and Iraq — has pushed up prices of Indian orthodox tea. But the spectre of renewed Israel–Iran tensions now looms large, threatening potential disruptions. Anshuman Kanoria, chairman of Indian Tea Exporters Association (ITEA), said there is cargo already on the water, some awaiting shipment, and the fate of future orders — all of this is cause for concern. 'We are worried and concerned about the suffering on the ground as well as exports. The members are in touch with the buyers. At this moment, we are in wait-and-watch mode.'
