A woman collects tea leaves in Assam in north east India

A woman collects tea leaves in Assam in northeast India

Tea prices risk boiling over following a spate of extreme weather events that have poured misery on growers in India.

The price of everyday teabags – already up as much as 30% year on year across branded and own-label lines sold in UK mults – could be about to rise further after heatwaves and flooding in the north-eastern state of Assam, which accounts for half of all output in India.

“Extreme weather events are hurting tea production. Excessive heat in May, followed by ongoing flooding in Assam, are reducing output,” said Prabhat Bezboruah, a senior tea planter and former chairman of India’s Tea Board.

Production had also been hit by the government’s ban on pesticides, Bezboruah added.

Tea production in India in May was down by 30% year on year, to 91 million kilos – the lowest figure that month for over a decade.

That has caused wholesale prices to soar. According to data compiled by the Tea Board, Indian tea prices climbed to Rs 217.53 (£2.04) per kg in the last week of June, a 20% uplift on the same period a year prior.

The extent to which elevated commodity prices will filter through to UK shoppers is likely to depend on the amount of Indian tea used by leading domestic suppliers, the willingness of manufacturers and retailers to absorb higher costs, and the length of contracts suppliers currently have in place.

Britain – India’s largest tea export market – has already been hit by disruption this year, after Houthi attacks in the Red Sea forced shipments to be diverted via the Cape of Good Hope.

And the cost of tea in supermarkets is already rising, with shelf-edge prices of own-label teabags up 3% month on month and 15% year on year, according to The Grocer’s Key Value Items (KVI) tracker.

Pre-promotional prices of both branded and own-label tea are also climbing.

Morrisons Savers Teabags 80s rose by 12.7%, to 89p, between 9 June and 9 July, according to Assosia data, whilst 160-bag packs of Yorkshire Tea in Sainsbury’s were up by 11.11%, to £5.50, over the same period.

Morrisons said it had reduced the price of its Savers Teabags to 80p on 10 July, adding it sourced its own-label tea from Kenya.

Yorkshire Tea had not responded as The Grocer went to press.

Year on year, some lines have seen pre-promotional price rises of over 20%. PG Tips’ 210-packs in Tesco have increased 31.0% to £5.49, whilst 80-bag packs of Tesco’s Stockwell & Co brand are up 27.3%, to 94p [Assosia].

Tetley’s 160-bag packs of Everyday Teabags have seen a £27.7% uplift in Sainsbury’s, and now command a pre-promotional price of £4.65.

A spokeswoman for PG Tips owner Lipton Teas & Infusions said: “We don’t source much tea from India, however the increasing frequency of severe weather events around the world will have consequences for food and drink prices over time.”

The tea giant was “supporting farmers to take urgent climate change mitigation and adaptation actions”, they added.

Tesco declined to comment. Tetley’s and Sainsbury’s had not responded as The Grocer went to press.