Transformation of Asian tea markets

15 October 2012

Solidaridad Asia and its partner Business Watch Indonesia have set a target of covering 50 percent of all smallholders under Lestari sustainable certification by 2014. The production of tea provides millions of farmers globally with an income, but rising production costs coupled with low global tea prices often results in poor quality tea and inadequate returns for smallholders.

Lestari is Asia’s first mainstream sustainability certification scheme for tea, which aims to establish standards to improve the quality and productivity of tea farming. Major tea businesses over the world are demanding that tea be produced in a socially and environmentally sustainable way under international standards.

Shatadru Chattopadhayay, Solidaridad’s International Programme Coordinator for Tea, says most of Asian small tea estates and smallholders have remained out of the scope of global sustainability certification programmes. “This is despite the fact that 74% of the world’s tea is consumed in Asia. However, as some of the global tea marketing companies commits to introduce sustainable tea in all markets where they operate, the Asian tea markets will be sustainably transformed.

Since 2008 Solidaridad has been the first organisation in the world to work on this market transformation for tea in Indonesia, China and India in partnership with The Sustainable Trade Initiative (IDH).”Lestari standard was developed by the Indonesian tea industry stakeholders to improve the conditions of the small tea producers and provides Indonesian consumers with sustainable and certified tea.

Lestari standard

The Lestari certification has so far helped around 10,000 smallholder tea growers (which is 11% of all tea smallholders in Indonesia) producing around 5,500 tons of black tea to be certified. In the first year farmers achieved a 15% increase in their net income.The criteria in the Lestari Standard consist of 143 control points and the compliance process provides a gradual improvement system over three years; not all control points must be met in the first year.

However, many smallholders find it difficult to implement these global standards due to their small size, no guarantee of market access and high certification costs. Moreover, international standards are only useful in the context of export markets, as none of the international standards are applicable for the domestic market of Indonesia.

Challenges

Chattopadhayay believes that every region has its unique challenges and that local standards are not necessarily a competition to global standards. “Indonesia is the world’s fourth most populous country with rapidly increasing demands of tea. Yet, the per capita consumption is only 0.31 kgs compared to Ireland’s per capita consumption of 3.5 kgs. I foresee that in future more land will be used to grow tea in Indonesia to meet growing demand.” He further points out that tea cultivation will be expanded in new regions and that the Lestari standard will ensure that expansion is done responsibly. 

Lestari Tea Animation

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