Econo-Tea

I have to admit, I’ve never thought much about just what kind of money goes into or comes from tea. It’s never seemed like a big cost to me. A few bucks for a cheap pack of tea bags in the grocery store. Gourmet teas can cost a bit more. Our own comes in at around 8 bucks, but the amount you get lasts a long time. It still comes in really cheap per cup. But I figured, I’ve talked about the economy of coffee a good deal, it’s time to learn more about tea.

So, I started doing some research on tea and the economy. As an aside, do you know how hard it is to find good articles on Tea from Google if you don’t remove the word ‘Party’ from the search parameters? Grrrr.

Anyways, Tea is a huge part of the global economy. Even looking at older data (I’m talking 1988 here. Ancient!) 5.5 billion pounds of tea were shipped worldwide, and ranging at average wholesale prices of anywhere between $1.50 to $0.83 per pound. I punch those numbers into my calculator and it starts swearing at me. These numbers are big. And then there are the specialty teas that can clock in at over $95 a pound. eesh.

So I think we can establish that tea is a freakin’ huge business. Well, that’s nice. Why should we care?

Well, when you have a business that large which can have quite an effect on the world stage, it seriously affects the lives of many people. From the grower to the importer to the retailer, it’s a great big interdependent web. Knowing how that web works, what people get, what’s expected, and the realities of economies around the world, we can become more informed consumers, and maybe we can use our buying power to make things a bit more fair for everyone.

Let’s look at Sri Lanka. It produces around 700 million pounds of tea each year, which brings in around a billion dollars to the country’s economy. However, the way their plantations are set up, with workers, supervisors and superintendents all drawing wages, as well as the tea plantations maintaining estate communities (a holdover from colonization times) which is essentially social welfare for everyone who lives in the community, from housing to education, the plantations tend to operate at a loss. And this is with workers receiving wages of $5.00 a day. Yeah, that’s right. Five dollars. A day. And that’s twice the wage of workers in Kenya, who make around $2.50 a day. Though apparently that’s a living wage in Kenya, while $5.00 isn’t in Sri Lanka. I don’t blame the people in Sri Lanka who say that the way they run things needs to change.

Other factors also worry tea growers. One of the many consumers of tea from Kenya is Egypt. But, unless you’ve been living under a rock, you know that Egypt is in major turmoil right now. Countries in the midst of aggression may not be as likely to import a lot of tea, and that’s going to affect how much the average Kenyan worker gets paid.

Now, let’s flip to the other side. Retail, especially in the western world. People want to sell tea and make a profit doing so. What does that take?

Well, in California, it takes around $300,000 a year. And now I rub my eyes and re-read that number. We go from a buck a pound and $5.00 a day for workers to about $825.00 a day to run a tea store. Well, to be fair, cost of living in the west is huge. You have to pay your staff a decent wage. And while tea may sell cheaply at wholesale, there’s also the cost of transport, inventory costs, packaging costs, marketing costs, and so on. You factor all that in, and shit gets expensive.

So the question is, how do we make sure everyone gets a fair shake? Well, for starters, tea, like coffee, is forming its own Fair Trade practices. I’m a fan of such things. Better treatment of workers, more sustainable farming practices and so on are all excellent. Infrastructure around the world continues to get more efficient as time goes on. With the help of impassioned tea advocates and accessible information, it’s easier to educate people on tea quality and accessibility. Ultimately, if we all pay attention to where our dollars go, and what we’re willing to pay for, we can help equalize things bit by bit.

I admit, this post is a bit of a ramble, because with the numbers I’m looking at, it’s hard to make heads or tails of it all. But this is a great big world that we all share, so it certainly can’t hurt to learn more about it.

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