Indian tea prices rise 18% as demand surges from Russia, Iran, Iraq and UAE

Kolkata: Indian tea prices increased 18% in the first four months of this year from a year earlier, pushed up by strong demand from markets like Russia, Iran, Iraq and the UAE. With exports demand remaining robust and consumer goods firms such as Hindustan Unilever and Tata Consumer Products stepping up purchases for the local and international markets, auctioneers and industry executives expect the prices to stay firm and shipments to top last year's levels.

Companies that sell packet tea, however, aren't currently planning to pass on the higher price to local consumers as they don't want to risk losing market share, said industry executives.

According to Tea Board figures, the average wholesale tea price in the January-April period rose to ₹160.49 per kg from ₹136.41 a year earlier. This average is for a mix of premium orthodox (hand-rolled) tea and the common CTC dust and leaf teas from South India, Assam and West Bengal.


International demand for Indian tea remains strong. "There has been a significant rise in demand for Indian tea from the Middle East countries and Russia. They buy premium orthodox tea," said Mohit Agarwal, director of Asian Tea, a Kolkata-based tea exporting firm. "If this momentum continues, then the overall tea exports of the country will surpass last year's exports."

The price of Assam orthodox tea has hit a record high of ₹314 per kg at auctions, Agarwal said. Prices are expected to remain firm even as the second flush teas will start coming to the auction centres in Guwahati and Kolkata from June second week, he said, adding: "For the year 2025, we can expect record production and prices as the Middle East will continue to buy Indian teas."

India exported about 255 million kg of tea worth ₹7,111 crore in 2024, when it moved up to the third position from the fourth on tea exports by replacing Sri Lanka. Exports from Assam and West Bengal totalled 154.81 million kg, valued at ₹4,833 crore. South India's share was 99.86 million kg worth ₹2,278 crore.

Production in the first four months of 2025 has also increased from a year earlier. Figures released by the Tea Board show production at 203.14 million kg, up 28.94 million kg from the January-April period of last year.

"Even though all the packet tea players are buying heavily, there are no immediate plans to raise prices for the end consumers. If prices rise further, then there may be a marginal price hike for the consumers," said Viren Shah, chairman of Gujarat-based Jivraj Tea. "But these are early days, and nobody would like to lose their market share by increasing prices."

J Kalyanasundaram, secretary of the Calcutta Tea Traders Association, said players like HUL and Tata Consumer Products stepped up purchase at the auctions, after the government made auction compulsory for 100% CTC dust teas. "This has resulted in a price rise. Prices of this variety have shot up by ₹19-20 per kg," he said.