U.S. Demand for Quality Tea Skyrocketing

While tea has always been the preferred beverage of choice amongst many nations across the globe, it has always taken the backseat to the likes of coffee, soda and many other beverages in the U.S.

However, a recent study seems to contradict the idea that Americans do not enjoy drinking tea and, on the contrary, it suggests that they are actually developing quite a taste for the beverage. According to the U.S. Tea Association, the U.S. market for tea has skyrocketed from under two billion dollars to approximately ten billion dollars between the years 1990 and 2013.

During this same time period, the market for coffee, arguably the tea market’s greatest competitor, has remained relatively stable in its growth.

American consumers aren’t the only ones picking up on the tea trend, as many corporations are looking to cash in by acquiring smaller tea companies. Most notably, Starbucks purchased the tea retailer Teavana for over a half of a billion dollars in 2012 in order to keep up with the recent surge in the demand for tea.

Though the demand for tea has increased, the type of tea Americans are drinking is surprisingly different than what the rest of the world prefers.  Black tea and iced tea have been long-time American favorites, with fruit and herbal varieties following suit. However, the fastest growing teas in the United States are artisanal and green tea. In fact, green tea has seen nearly a 40% increase in consumption since 2000.

While tea has long been praised for its medicinal properties across the world, the U.S. seems to be only recently catching on to the trend and much of the demand for tea is now being attributed to the medicinal benefits that tea provides.

The increase in U.S. demand for tea is great for the industry; however, global tea producers are struggling to keep up with the uptick in worldwide demand. Tea imports in the United States have risen by 40% in just the last decade. And the majority of this supply is coming from China, where tea was first discovered thousands of years ago.

Stricter guidelines and regulations for tea production has dramatically changed in recent years, which makes producing drinkable tea much more difficult for suppliers. However, more rules for tea results in a healthier product, something that we now know drives the demand in the U.S.

Though consumers may not feel the effects of these regulations directly, the increase in demand will certainly put a strain on tea producers around the globe. Couple this with the increased demand for tea in the massive U.S. market and it is looking like tea production will do anything but slow down in years to come.