10 hours ago
Tea trade disrupted: Iran-Israel war halts exports; Kolkata shipments pile up
KOLKATA: The Iran-Israel conflict has brought to a standstill all tea exports to Iran, the second-largest recipient of Indian tea after Russia. Consignments that have already left the city for Iran are now piled up at Mumbai's Nhava-Sheva port.
The sudden break has come at a time tea exports to Iran saw a major revival in 2024 after a muted 2023.
Last year, Indian tea exports to Iran grew five-fold to 31 million kg from 5.9 million kg in 2023, when US sanctions against Iran had led to a sharp drop. In 2022, the export figure was 22 million kg. Iran has a 20% share of India's total tea exports, say officials.
'Every year, we export 5 million kg of tea to Iran. But our consignments are lying in Nhava-Sheva since June 14 as the shipping route to Iran is temporarily suspended because of the war,' said Sashi Kanta Shah, chairman of Shah Brother, one of the leading tea exporters in the city.
Indian Tea Association chairman Hemant Bangur said exporters were also holding back shipments because they were unsure of payments. At the same time, Iranian importers were also buying time because they were also not sure if they could make payments.
Iran primarily imports tea produced in Assam, Darjeeling and Dooars. Assam has the largest share — 80% — of the export basket with the rest being contributed by Bengal.
Kolkata is the hub of tea export in north India.
'Orthodox tea grown in Assam and Dooars has a big market in Iran. Besides, high-quality CTC (crush, tear, and curl) tea is also sent there along with Darjeeling tea. Assam tea is blended and packaged in Kolkata before being exported,' said Bijoy Gopal Chakraborty, president of Confederation of India Small Tea Growers Association.
Exporters are racing to fulfil pending orders before freight costs further skyrocket, said Anindya Sengupta, co-founder of Small Tea Growers Associates, a city-based manufacturing company.
'The import volume of Iran has already declined while the war has turned the situation for the worse. We are now focusing on the UK and Europe markets,' he added.
Sujit Patra, former secretary of Indian Tea Association, said earlier Iran used to import higher quantities of premium Darjeeling tea. 'With the price of Darjeeling tea rising, they have shifted more to the Assam variety and Dooars tea. Exporters from Kolkata primarily use the Mumbai port to send shipments to Iran,' he said.
