1 of 2
Photo: ITC, Tea plantation, Fikkal, Ilam Nepal
2 of 2
Photo: ITC, Tea plantation, Fikkal, Ilam Nepal
Twenty years ago, Nepal's government turned its attention to tea both to alleviate rural poverty and generate foreign revenue from sustainably produced exports. Exports of Himalayan Nepali Tea expanded, rewarding long-term investments dating to 2001 when Nepal first adopted a national strategy to improve green leaf quality. In February, the government announced a $1.5 million 36-month sustainable export promotion project that will make traceability and organic production a defining characteristic of Nepal's teas.
“The National Export Strategy [NES] identified voluntary organic certification, supported by a traceability system throughout the production, as one of the key success factors for Nepal’s tea sector in the global market,” according to government documents.
“Nepali tea has demonstrated great domestic and international market potential,” according to NES. Transparency advocates say that publicly declaring the provenance of Nepali tea will increase sales globally. Tea, which has been grown commercially for 157 years, is Nepal's first branded agricultural product. In 2018 the government trademarked the description “Nepal Tea Quality from the Himalayas."
Last September, Nepal awarded certificates permitting 12 of the 42 factories that applied to display the trademark. The mark protects against counterfeit tea and loss of reputation and can enhance the value of tea. Nine of the 12 factories were located in Ilam, where tea was first grown in 1863.
During ceremonies, Bishnu Kumar Bhattarai, executive director of the Nepal Tea and Coffee Development Board (NTCDB), part of the Ministry of Industry and Commerce, said, "This is the beginning. Other producers will also soon get the certificate if they fulfill the requirements.” In February, he told The Kathmandu Post, "This [traceability] project will do the work of branding by producing quality tea." He called on farmers “to be honest to make the effort a success.”
Rabin Rai, general secretary of the Central Tea Cooperatives Association (CTCA), told the Post that a systematic record of cultivation, processing, transportation, wholesaler transactions, packaging, and retail details would draw favorable international recognition by consumers. He said that CTCA is committed to “spreading awareness among cooperatives and entrepreneurs and adopting a traceability system and organic certification.”
Throughout Nepal's long history, nearly all its tea exports were used in blends, obscuring the region's identity. Eighty percent of the country's tea are assamica cultivars grown on the Tarai (foothills) and processed as CTC (cut, tear curl). Only 5 million kilos are hand-made from the sinensis-sinensis cultivar (China bush) that grows slowly at high altitudes with a shorter harvest period. The higher-value “orthodox” teas are purchased by Germany, the US, Canada, and Japan, which account for 10% of export volume.
Nepal expanded planting to 13 districts beyond the existing 5, which produced a combined 25 million kilos in 2019. These districts, mainly in the west, are better suited to orthodox production. It took five years for NES to build momentum, but the balance of trade in tea gradually climbed during the 10 years that followed, and employment rose to 70,000 (30,000 full-time equivalents).
By 2015 tea exports totaled 11 million kilos and constituted 2.68% of total merchandise exports from Nepal. Sales that year approached NPR 2 billion (US$17 million) with 88% of the tea destined for India. Exports to India have since declined to 80% of total production as Nepal seeks a more diverse group of countries as trading partners. Last year Nepal produced 6,000 metric tons of orthodox tea and 19,000 metric tons of CTC. The Trade and Export Promotion Center reported a 13% drop in sales to NPR 2.78 billion in 2019-20, down from NPR 3.2 billion in sales during the previous harvest year.