IRAN
U.S. sanctions imposed to punish Iran have cut demand as traders are scared to transact with Iran for fear of not getting paid as banks shy away from remitting money from the country.
Iran is an important tea trading partner, paying good prices for large orders of Indian, Sri Lanka, and Kenyan tea. When a previous round of sanctions was lifted in 2016 exports surged and profits rose for traders supplying CTC (cut, tear, curl) to Iran’s 80 million tea drinkers. Kenya Tea Development Agency (KTDA) said earnings are down 17% due in part to financial restrictions reinstated in November 2018.
The inability for the two countries to trade in dollars led to a surplus greater than the local export market can absorb, say KTDA officials.
Iran is the world’s fifth largest tea importer, purchasing $280 million from Kenya last year. About 20 percent of Iran’s 88,000 metric tons of tea imports are from Kenya with Sri Lanka, India, and China supplying the rest.