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Sanjay Shah, chairman of the Federation of All India Tea Traders Association (FAITTA), has said that sluggish growth in domestic consumption, rising food inflation and slow recovery of exports post the Covid pandemic are some of the challenges faced by the tea industry. He said tea producer associations and the Tea Board India have been concerned over the muted demand growth in the country.

He said ‘As retailers within the FAITTA fold, we are witnessing the market movements from close quarters. It is a fact that loose tea consumption has been giving way to packet tea.’ He said rising levels of food inflation also remain a concern area, as it adversely impacts consumption.

He also said given that incomes do not adjust as fast as prices, high inflation in essentials tend to adversely impact demand for non-essentials. Even within essentials, consumers may shift to lower priced non-premium products. Moreover, he also maintained that there are underlying concerns over the ability of the market to absorb the several rounds of price increases (of tea), which have been inevitable given the sharp rise in main raw material prices last year.