Review of the Prospects for the Australian Black Tea Industry A report for the Rural Industries Research and Development Corporation by Dr Peter Chudleigh Agtrans Research March 1999 RIRDC Publication No 99/28 RIRDC Project No AGT-5A © 1999 Rural Industries Research and Development Corporation. All rights reserved. ISBN 0 642 57858 3 ISSN 1440-6845 Review of the Prospects for the Australian Black Tea Industry Publication No 99/28 Project No. AGT-5A The views expressed and the conclusions reached in this publication are those of the author and not necessarily those of persons consulted. RIRDC shall not be responsible in any way whatsoever to any person who relies in whole or in part on the contents of this report. This publication is copyright. However, RIRDC encourages wide dissemination of its research, providing the Corporation is clearly acknowledged. For any other enquiries concerning reproduction, contact the Publications Manager on phone 02 6272 3186. Researcher Contact Details Dr Peter Chudleigh Agtrans Research PO Box 385 TOOWONG QLD 4066 Phone: (07) 3870 9564 Fax: (07) 3371 3381 RIRDC Contact Details Rural Industries Research and Development Corporation Level 1, AMA House 42 Macquarie Street BARTON ACT 2600 PO Box 4776 KINGSTON ACT 2604 Phone: 02 6272 4539 Fax: 02 6272 5877 Email: [email protected] Website: http://www.rirdc.gov.au Published in March 1999 Printed on environmentally friendly paper by Canprint ii Foreword This project was undertaken to give the Corporation and other would-be investors a better understanding of the current status and future prospects of Australia’s black tea industry. This understanding is needed to help RIRDC form a view as to what level of research and development investment is warranted and where any investment would be best placed to help the industry grow and prosper. The project complements a 1994 workshop that was used for setting research and development priorities for the tea industry as a whole. This report, the latest addition to RIRDC’s diverse range of over 250 research publications, forms part of our New Plant Products R&D Program which aims to facilitate the development of new industries based on plants or plant products that have commercial potential for Australia. Peter Core Managing Director Rural Industries Research and Development Corporation iii iv Contents Page Foreword iii 1. Introduction 2 2. Current State of the Australian Black Tea Industry 3 2.1 Production 3 2.2 Processing 8 2.3 Packaging 10 2.4 Marketing 11 3. Future Market Penetration and Development 12 3.1 World Market 12 3.2 Australian Market 12 4. Future Economies of Production and Industry Growth 15 5. Summary 18 References 20 1 1. Introduction The Australian black tea industry is relatively small, and growth over recent years has been slow. Black tea has been grown in Australia since the early 1930s. The Australian black tea industry presently supplies between 5 and 10% of the total quantity of tea consumed in Australia. The majority of tea consumed in Australia is sourced from developing countries. Isolated R&D efforts have investigated particular aspects of tea production. RIRDC has supported R&D in the black tea industry in the past, with the most recent black tea project being completed around four years ago. RIRDC Project DAT-29A ‘National Tea R&D Priority Setting Workshop’ was undertaken in 1994. RIRDC Project DAQ-122A ‘Assembly and Preliminary Evaluation of Imported Tea Clones’ was commenced in 1993. Additional projects researching aspects of black tea production would have been undertaken by various organisations prior to 1992. This report presents the results of a brief review of the prospects for the Australian black tea industry. Chapter 2 provides an assessment of the current state of the industry in terms of production, processing, packaging and marketing. Chapter 3 reports the prospects for future market penetration and development, and Chapter 4 assesses the future economics of production and likely growth of the Australian black tea industry. Chapter 5 summarises the key findings of this review. 2 2. Current State of the Australian Black Tea Industry 2.1 Production Technical Aspects The scientific names for the two species of bush that produce black tea are Camilia sinensis and Camilia accamica. Black tea bushes are typically grown in sub-tropical and tropical regions with annual average rainfall of greater than 1,500 mm. The north-eastern seaboard of Australia is perceived as suitable for black tea production. Tea bushes are capable of yielding for up to 100 years. Tea can be established from either seed or from cuttings/clones. All tea grown in Australia was established from seed. One Australian tea producer has observed tea established from cuttings produces a more uniform hedge which is more suited to mechanical harvesting. However, tea established from cuttings may not develop a strong tap root until the plant is 3 to 5 years old. A strong tap root is required in dryland production areas where soil moisture may be seasonally low, to enable the tea plant to source soil moisture at depth. It is reported that yields in major tea growing countries overseas from tea established from cuttings are significantly greater than tea established from seed. Tea producers overseas are pulling out tea established by seed and re-establishing tea bushes from cuttings to increase yields and economic returns (Twyford, 1998, Pers. Comm). Following planting, black tea bushes take up to five years to produce their first yield. During the initial establishment period, irrigation may be required to meet water requirements of the tea bushes. Maximum yield is achieved approximately 10 years following establishment. In north Queensland, once the tea bushes have matured, harvesting of the green tea leaves occurs approximately every three weeks. The time between harvests increases over the winter months in areas where winter temperatures are low enough to cause a reduction in growth rate. Harvests are undertaken every four weeks during winter months on the Atherton Tablelands, which experience a cooler winter period than coastal areas of north Queensland. There is believed to be no reduction in the quality of tea produced over winter months in the north Queensland region. Following harvest, green leaf is required by one Australian processing factory to be transported to the processing plant within 90 minutes of harvesting to maintain quality. In northern NSW, there is a 4 to 6 month period over the winter months where the tea bushes are not harvested as low winter temperatures inhibit the production of leaves by the tea bush. During this off-season the plants are trimmed and fertilised, and infilling is undertaken which involves planting tea bushes in any gaps in the hedge that might exist. World-wide, some producers believe the tea plants should be grown in seasonal areas so the plants can be spelled over winter in order to produce quality tea, but other producers believe a spelling period is not required to maintain quality. In northern NSW, tea is harvested every 3 weeks at the beginning of the harvest season, and this time reduces to every 7 to 10 days during the peak season (January to March). 3 Fertiliser is required to maintain tea quality and yields. Fertiliser is considered an important but very costly input. Information regarding the optimum quantity of fertiliser to apply and the timing of fertiliser application is unavailable for Australian growers and is considered by one Australian tea producer to be a significant gap in knowledge for efficient tea production. Irrigation may be required to establish young tea bushes in their first year, but is not necessarily required following successful establishment of the plants if rainfall is high and reliable. One Australian tea producer considered it important for tea to be grown in high rainfall areas, as it may be uneconomic to provide irrigation for tea on an on- going basis. Irrigation in high rainfall areas may be required in emergency situations such as drought, as if tea plants are not watered for three weeks, they are likely to cease producing leaves and die. In a lower rainfall region, another Australian tea producer uses irrigation across all seasons to supplement rainfall. Traveller irrigators are considered suitable for tea production. The black tea bush is not particularly susceptible to Australian insect pests and diseases. Weeds are of concern to tea producers, and are typically chemically controlled. Care with the timing of chemical application is required to ensure there is no chemical residue on the tea leaves at harvest. There are no commercial manufacturers in Australia of planting and harvesting equipment required to grow tea. Equipment needs to be custom made but can be readily manufactured. Transport equipment is required to move the harvested green leaf to a processing facility. Area of Black Tea The quantity of black tea produced in Australia is very small in comparison to total Australian consumption. It is estimated there are approximately 750 hectares of black tea plantings in Australia in 1998. The area planted to black tea in 1982 was estimated to be 100 hectares, increasing gradually to a reported 775 hectares in 1991 (Wood et. al., 1994). In 1994, it was estimated there were approximately 900 hectares planted to tea in Australia, of which approximately 700 acres were situated in north Queensland (Wood et. al., 1994). There appears to be a net reduction in the total area of tea grown in Australia since 1994, although in some areas such as Atherton Tablelands, plans for new plantings have been implemented. There are a number of tea plantations in Australia. Calata Pty Ltd is located on the Atherton Tablelands in north Queensland and is the largest estate.