Tea Market Trends

Global Tea Market Overview

Tea Market Size was valued at USD 19.76 Billion in 2023. The Tea industry is projected to grow from USD 20.67 Billion in 2024 to USD 28.33 Billion by 2032, exhibiting a compound annual growth rate (CAGR) of 4.02% during the forecast period (2024 - 2032). Increasing demand for specialty and functional teas and changes in consumer preferences are the key market drivers enhancing market growth.

Source Secondary Research, Primary Research, MRFR Database, and Analyst Review

Tea Market Trends

• Growing of specialty teas is driving the market growth

The rising of specialty teas is driving the market CAGR for tea. Specialty teas, including premium and artisanal varieties, have gained considerable traction in the tea market. Consumers increasingly seek unique and high-quality tea experiences, leading to the growth of specialty tea retailers and tea houses. The demand for specialty teas is driven by factors such as flavor diversity, organic and natural attributes, and a focus on the origin and quality of tea leaves. Moreover, specialty teas have witnessed a surge in popularity due to their perceived health benefits. Variants like green tea, white tea, oolong tea, and herbal infusions are known for their antioxidant properties, potential weight management benefits, and other wellness claims. The rise of specialty teas has paved the way for tea connoisseurs, who value the art of brewing and appreciate the complexity of flavors, to explore unique blends and single-origin teas.

The tea industry is witnessing a shift towards sustainable and ethical tea production practices, driven by consumer awareness and increasing concerns about environmental impact and social responsibility. Consumers increasingly demand clarity in the supply chain, ensuring fair wages, safe working conditions, and environmentally friendly farming practices. Tea companies respond to this trend by adopting sustainable cultivation techniques, such as organic and biodynamic farming, and promoting fair trade practices. Additionally, certifications like Rainforest Alliance, Fairtrade, and Ethical Tea Partnership are becoming more prevalent, enabling consumers to make informed choices about the tea they consume. Companies are also investing in community development initiatives in tea-growing regions, focusing on education, healthcare, and infrastructure to improve the livelihoods of tea workers.

Tea has transcended its traditional image as a simple beverage and has evolved into a functional drink, offering health benefits beyond hydration. Available teas are infused with additional ingredients like herbs, botanical extracts, vitamins, and minerals, catering to specific consumer needs. This trend aligns with the growing focus on health and wellness, with consumers seeking functional beverages as part of their daily routines. Available teas targeting specific health concerns such as digestion, immunity, stress relief, and sleep support have gained substantial market traction. For instance, herbal blends containing ingredients like chamomile, peppermint, and ginger are known for their calming and digestive properties. Similarly, teas enriched with antioxidants, such as matcha and rooibos, are sought after for their potential health-boosting effects. Manufacturers are innovating and expanding their product portfolios to offer a wide range of functional teas to cater to diverse consumer demands.

For instance, the market of tea is experiencing dynamic shifts driven by evolving consumer preferences, health consciousness, and sustainability concerns. The rise of specialty teas has provided consumers with various unique and premium tea experiences. Tea's transformation into a functional beverage has opened new avenues for innovation, targeting specific health concerns and offering added benefits. Furthermore, the emergence of sustainable and ethical tea production practices reflects the growing importance of social and environmental responsibility in the industry, driving the Tea industry revenue.

Tea Type Insights

The Tea market segmentation, based on type, includes green tea, black tea, oolong tea, herbal tea, and others. The green tea segment dominated the market due to its numerous health benefits, including antioxidants and metabolism-boosting properties. It is anticipated to witness substantial growth in the forecast period.

Tea Form Insights

The Tea market segmentation, based on the form, includes loose leaf, tea bags, and others. The loose-leaf segment dominated the market. It allows consumers to customize the strength and flavor of their tea. The demand for loose tea is driven by its perceived freshness and the growing popularity of tea connoisseurship.

Tea Category Insights

The Tea market segmentation, based on category, includes organic and conventional. The conventional CATEGORY generated the most income due to its lower cost and wider availability. It is produced using traditional farming methods, which may involve pesticides and chemical fertilizers.

Tea Distribution Channel Insights

The Tea market segmentation, based on distribution channels, includes store-based and non-store-based. The store-based category generated the most income. These physical retail outlets have a significant presence and are widely accessible to consumers. They offer many tea products, including loose-leaf teas, bags, packaged teas, and ready-to-drink tea beverages. Specialty stores and tea shops offer a unique and curated tea experience, often focusing on premium and artisanal tea products.

Figure 1:  Tea Market, by Distribution Channel, 2022 & 2032 (USD Billion)

Source Secondary Research, Primary Research, MRFR Database, and Analyst Review

Tea Regional Insights

By region, the study provides market insights into North America, Europe, Asia-Pacific, and the Rest of the World. The North American Tea market area will dominate this market. The demand for specialty teas, herbal infusions, and functional teas has been steadily rising in this region. Health-conscious consumers are attracted to the health benefits associated with tea consumption, leading to an increased interest in green tea, herbal blends, and wellness-focused teas. The market is also witnessing a surge in ready-to-drink tea products and innovative tea flavors to cater to diverse consumer preferences.

Further, the major countries studied in the market report are The US, Canada, German, France, the UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.

Figure 2:  TEA MARKET SHARE BY REGION 2022 (USD Billion)

Source Secondary Research, Primary Research, MRFR Database, and Analyst Review

Europe's Tea market accounts for the second-largest market share due to its strong tea consumption and growing demand for specialty teas. European countries have a significant tea culture and contribute to the region's market growth. In recent years, there has been an increasing trend towards premium and organic teas in Europe, with consumers seeking high-quality and unique tea experiences. Further, the German market of tea held the largest market share, and the UK tea industry was the fastest-growing market in the European region.

The Asia-Pacific Tea Market is expected to grow fastest from 2023 to 2032. It is due to its favorable climatic conditions, vast tea plantations, and large population of tea enthusiasts. In China, tea production is deeply rooted in its culture, and various tea types, including green tea, black tea, and others, are widely consumed. India is famous for its robust tea industry, particularly Assam and Darjeeling teas. Moreover, China’s market of tea held the largest market share, and the Indian tea industry was the fastest-growing market in the Asia-Pacific region.

Tea Key Market Players & Competitive Insights

Leading market players are investing heavily in research and development in order to expand their product lines, which will help the Tea market grow even more. Market participants are also undertaking various strategic activities to expand their footprint, with important market developments including new product launches, contractual agreements, mergers and acquisitions, higher investments, and collaboration with other organizations. To expand and survive in a more competitive and rising market climate, the Tea industry must offer cost-effective items.

Manufacturing locally to minimize operational costs is one of the key business tactics manufacturers use in the Tea industry to benefit clients and increase the market sector. In recent years, the Tea industry has offered some of the most significant advantages to medicine. Major players in the Tea market, including Associated British Foods PLC, BARRY'S TEA, HAIN CELESTIAL GROUP, INC., ITO EN, LTD., Mcleod Russel India Limited, Nestle S.A., TAETEA, Tata  Beverages, The Republic of Tea, Inc., Unilever Group, and others, are attempting to increase market demand by investing in research and development operations.

Twinings, founded in 1706, and located in Andover, Hampshire, United Kingdom, is a British marketer of tea and other beverages, which includes coffee, hot chocolate, and malt drinks that Associated British Foods own. The tea varieties include green tea, black tea, and herbal tea, along with fruit-based cold infusions. In February 2022, Twinings, a tea brand, launched the creation of a different series of tea blends called Superblends range which includes five different types of tea blends named Sleep, Calm, Digest, Focus, and Glow to improve health and well-being.

Tetley, founded in 1837, is an English beverage manufacturer in Greenford, London, England. It is the largest tea manufacturer company in the United Kingdom. Its parent company is Tata Consumer Products, making it the world's second-largest teas manufacturer. In September 2021, Tetley, a Tata Consumer Products tea brand, launched a trial tin can for its tea bags along with Tesco and Loop to reduce waste caused by disposable containers.

Key Companies in the Tea market include

• Associated British Foods PLC


• BARRY'S TEA


• HAIN CELESTIAL GROUP, INC.


• ITO EN, LTD.


• Mcleod Russel India Limited


• Nestle S.A.


• TAETEA


• Tata Beverages


• The Republic of Tea, INC.


• Unilever Group

For Instance, July 2021 Tata Consumer Products launched its tea packaging plant in Gopalpur Industrial Park by Tata Steel Special Economic Zone, which will help raise the volume of teas and tea bags produced.

For Instance, September 2021 Twining’s, a tea brand, announced the creation of a new food service exclusive range, including 11 tea blends specially made for the food service industry.

Tea Market Segmentation

Tea Type Outlook

• Green Tea


• Black Tea


• Oolong Tea


• Herbal Tea


• Others

Tea Form Outlook

• Loose Leaf


• Tea Bags


• Others

Tea Category Outlook

• Organic


• Conventional

Tea Distribution Channel Outlook

• Store-Based


• Non-Store-Based

Tea Regional Outlook

• North America
  
  
  
  • US
  
  
  • Canada
  
  
  
  


• Europe
  
  
  
  • Germany
  
  
  • France
  
  
  • UK
  
  
  • Italy
  
  
  • Spain
  
  
  • Rest of Europe
  
  
  
  


• Asia-Pacific
  
  
  
  • China
  
  
  • Japan
  
  
  • India
  
  
  • Australia
  
  
  • South Korea
  
  
  • Australia
  
  
  • Rest of Asia-Pacific
  
  
  
  


• Rest of the World
  
  
  
  • Middle East
  
  
  • Africa
  
  
  • Latin America