Despite facing challenges, tea industry better placed in 2025
Sector was hit by uncertain weather, heavy rains, pest attacks, and stagnant prices for much of the year
image for illustrative purpose
Kolkata: Despite challenges like uncertainty over weather conditions, rain fury, pest attacks, stagnant prices for a major part of 2025 and row over imports of inferior variety, the Indian tea sector fared relatively well this year with increased output and higher exports, stakeholders said.
Compared to 2024 when the crop was down by 100 million kgs, this year has been better for the overall industry, Tea Association of India president Sandeep Singhania said.
“Till October, we are ahead by 40-45 million kgs over the last year. The market in terms of pricing has been selective. It was encouraging for the best quality tea comprising around 10 per cent of the entire basket, but not good for the relatively lower quality varieties,” Singhania said.
During the January-October period in 2025, the country produced around 1,166 million kgs, while the output in 2024 calendar year was over 1,303 million kgs.
In terms of production, organised producers in North India—primarily Assam and West Bengal—reported a shortfall of around 11-12 million kgs during January-October, while output from small growers increased sharply by 40-45 million kgs, driving overall crop growth, according to ICRA Vice President and Sector Head Sumit Jhunjhunwala.
The higher contribution from small growers exerted downward pressure on CTC tea prices, particularly during July to mid-October, when prices declined by Rs 30-60 per kgs.
However, prices have shown a recovery in recent auctions, with realisations improving by Rs 20-25 per kgs for large growers. Despite this rebound, average prices in 2025 remain lower by around Rs 35 per kgs on a year-on-year basis, Jhunjhunwala said.
“In contrast, orthodox tea prices have remained firm, supported by robust demand and an expected increase of 20–25 million kgs in production,” he said.
Orthodox variety fetches better prices in the global markets.
“Sri Lanka, traditionally a major supplier of orthodox teas, has witnessed a decline in output to around 250 million kgs from nearly 300 million kg earlier, creating an opportunity for Indian producers to gain market share and realise better pricing,” Jhunjhunwala said.
Indian Tea Exporters’ Association chairman Anshuman Kanoria said this year is ending on an optimistic note.
“Despite no promotional support, I think we should close the year 15-20 million kgs over the last year. This increase in exports is largely due to substantial efforts and risks taken by our merchant exporters to increase demand in Iran, Iraq and other markets.
