Dubai Tea Forum Addresses Tea Industry Challenges

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DUBAI, UAE

If the global tea industry is to finance the good agricultural practices and manufacturing efficiencies essential to sustainable business fair pricing is paramount.

Dr. Shashi Tharoor, Former UN diplomat opened the seventh Global Dubai Tea Forum with the observation that "the global story today is that tea like other commodities is facing some challenges in prices, exports, and tea plantation with rising wages," he said.

"The challenges which will have the greatest impact in the tea industry are not challenges applied to the tea industry alone, but indeed represent global concern that have come to typify the twenty first century, weather is the changeling pattern in land use or climate induced extreme weather events that put tea production at risk,” he said

Dr. Ravi Fernando, chairman and c.e.o. of Global Strategic Corporate Sustainability Ltd., told Global Dubai Tea Forum attendees that “sustainability can, and must, play a key role in the tea industry globally. It must embed sustainability practices in its agricultural methods. It must implement renewable energy, rainwater harvesting, and other strategies. Climate change is set to have an increasing impact on the tea business, so it is vital that producer countries understand this and implement changes now in order to ensure their tea-growing future.”

Fernando, an author and executive in residence at the INSEAD Social Innovation Center, moderated a panel discussion on climate change and its impact.

"Tea demand is rising and we have to be able to meet the challenge of providing supply," said Anil Cooke, president and c.e.o., Asia Siyaka Commodities in Sri Lanka. “The tea trade has to identify and recognize the challenges that we are facing. These include climate change, urban migration away from the countryside which is reducing labor available for tea farming, and rising wages. Producer states must find a way to deal with these supply chain challenges in a way that enables tea supply to grow because tea is vital food product for some of the poorest people in the world. The future has already arrived and we must deal with these issues. It is important to state that there cannot be a trickle down effect: there has to be an equitable distribution so that all parts of the supply chain benefit.”

Vahdam Tea c.e.o and founder Bala Sarda, operates a tea company in India that is at the cutting edge of supply chain efficiencies. “We have identified ways in which technology can change the tea industry supply chain,” he said. "We source directly from the farmers, and then process, pack, and deliver directly to consumers in the United States and Europe. This cuts out the middlemen which saves time and costs. We are a farm-to-customer company which is leveraging technology to take the tea industry forward and provide tea quickly and efficiently," he said.

Ahmed Bin Sulayem, DMCC executive chairman, echoing the conference theme “Brewing the Future of Trade," said that since its founding in 2012 DMCC has demonstrated its role as market-maker, facilitators of trade, and a hub for the flow of commodities around the world.

"The DMCC Tea Centre is internationally recognized as a center of excellence for the industry and has helped secure the position of the United Arab Emirates as a valuable export route for the majority of the tea producing nations,” he said, citing the fact that DMCC last year handled 53 million kilos of tea, a 29% compound annual growth rate.

DMCC is also expanding operations locally. "According to Euromonitor International, the Middle East and Africa region will account for 11% of the total global retail value by 2022, growing at a 5% rate over the same period of time. In the UAE alone, Euromonitor International estimates that the tea market will be worth $70 million in 2018.

“Few people outside this region would have predicted that the DMCC Tea Centre would grow to handle over 53 million kilos of tea in just over a decade. Today we see over 100 brands of tea being packed at their facility in Jebel Ali, facilitating the trade of tea to international buyers worldwide, with tea being processed there from 13 countries!” said keynote speaker Mohammed Al Muallem, c.e.o. and managing director UAE Region DP World & c.e.o. JAFZA.

“Creating a successful tea marketplace derived from listening to market needs, delivering smart and efficien

t solutions to market participants, – and leveraging existing infrastructure such as our world-class port, and Dubai’s unrivaled global connectivity,” Al Muallem added.

“While the challenges that face the tea industry are indeed substantial, I believe the opportunities to resolve them, and in some ways to reinvent the tea trade, are very much there," said Dr. Shashi Tharoor. Reinventing the tea trade requires "the collective might of tea industry, from stakeholders across the supply chain, and with legislative support from governments, I would hope that we can actually drive sustainable change right from the cup of English breakfast tea, to a consumer sitting in London, all the way to the tea pluckers in the plantations,” he added.

Learn more: www.globaldubaiteaforum.ae.