Africa Tea Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The African tea market is projected to reach a CAGR of 5.5% during the forecast period, 2022-2027.

The tea industry in Africa is a labor-intensive industry. In Africa, Malawi alone employs a workforce of around 50,000 unskilled and semi-skilled workers. The peak seasons for tea plucking and production in Africa are from March to September, presenting a high risk of COVID-19 transmission due to the high concentration of people on the estates and in the factories. As the biggest tea exporting country in Africa, the tea sector industry in Kenya has experienced transportation disruptions from the tea-producing areas to the port of Mombasa and some consequential disruptions in cash flow. The impact on tea production itself so far seems limited. However, there was a clear increase in tea consumption during the pandemic as in-house consumption increased.

Over the medium term, increased health awareness, health benefits caused by tea, and a surge in disposable income are expected to drive the growth of the African tea market. Moreover, many market players focused on introducing additional healthy ingredients in tea, contributing to the overall market growth. Factors like introducing new flavors and varieties and rising demand for herbal tea are expected to bring more growth opportunities to the tea market.

Health and wellness are the major factors boosting the demand for smaller specialty teas in Africa, including fruit/herbal tea and green tea, which recorded strong retail volume growth in 2021, despite their higher than average unit prices.

Key Market Trends

Increasing Tea Production in African Countries

The tea cultivation areas in Africa are scattered from the gentle hills of Cameroon in the West to the high plateaus and mountain slopes on both sides of the great rift. Based on their production and processing, the tea varieties are CTC, orthodox, herbal/flavored, and leafy (including black, green, oolong, and decaf). Black tea still holds the largest share in the South African tea market. Black CTC tea constitutes about 99%of the African tea production. Additionally, specialty tea continues to gain popularity. Herbal and fruit teas with functional benefits, such as aiding digestion, are becoming increasingly popular among health-conscious consumers.

Rising Demand for RTD Beverages

Along with an increase in the innovations at ingredient levels, increasing launches of new products such as flavored RTD tea drinks, carbonated RTD tea, and caffeine-free RTD tea are majorly driving the demand for RTD beverages in the region. In addition, the market is supported by the health and wellness trend among consumers in the region, especially in South Africa. In line with health trends, green tea and rooibos variants of RTD tea are gaining momentum, given their perceived additional health benefits, including a high concentration of antioxidants. Moreover, growing health awareness of the consumers and the ongoing wellness trends, along with convenience, are some of the other driving factors influencing enlarge the RTD black tea market in the coming years.

Competitive Landscape

The African tea market is fragmented, with intense competition between multinational, regional, and local players. Introduction of new products and flavors, mergers, and acquisitions are the major competitive strategies followed by the key players in the market. Some major players in the African tea market are Tata Tea, Dilmah, DavidsTea, Twinings, and Van Rees, among others.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

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