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This question was posted in one of the tea forums I joined. I normally keep a low profile and refrain from expressing too much in such forums. However, reading the comments to the question has somehow touched my nerve and I rumbled one with my keyboard. It is not the proper writing as I do for the Tea Guardian, so I am sharing it here in “Dialogues”. Pls comment as you wish:
____________________________________________________________________________________I hope it’s not too late to join this discussion. To give a scope to the topic, one can view it as wide encompassing as Frank did, or focus in the horticultural aspect as Rogier pointed out, or concerned with the economics as has Warren.Indeed for a trade such as tea to sustain one should look at it from an environmental, economical and agricultural perspectives. I shall use these few minutes to write first about the economics, in response to Warren’s latest comment, and go on to the others in the next couple of days.
While it is true that the retail price of certain fancily packed products have been so inflated to out of control in China in fancy retail areas, the bulk export price to the main production volume remains only steadily increasing. That reflects both the increase in the salary for workers involved in the whole production-sales chain, and the rapidly appreciating RMB (the Chinese dollar). For example, the daily salary for a tea plucker in Fujian, where warren is more familiar with, was around 25 RMB a day in 2000, but it is now between 50 to 100, depending on the season and locality.
One would dread that with that kind of appreciating salary, the product can be getting too out of reach. The kind of price Warren quoted reflects whatever variety of tea that is being hyped up for speculative trading. Just as did pu’er “cakes” a few years ago, or the Tieguanyin before that. Such price would collapse naturally anyway and the merchants behind it understand. Those who do that are opportunists not unlike stock market players. I would view them as a “derivative” of the tea trade but not the tea trade itself.
Real prices for better quality tea are going up but it is much like the price of any other thing in China. The well-being of the agricultural workers is key in here. They are able to make a more reasonable living than before. Compare their salary, which is somewhere between 6 to 12 USD a day, with that in India, where most are still paid 2 a day and you see the picture.
The bulk of productions in India, and for that matter, other African and South-east Asian producing countries, with the exception of Taiwan, are sold in auctions which prices are pretty much at the finger tips of Western traders. The sellers are large brokerage firms or associations who control the access to the market. This way you get 1 USD a box of teabag in the supermarket, but maybe a few cents go to the producer. This is not dramatically different from the late 1800’s where the workers were literally enslaved to the tea “estates”. They have sustain this system till now, but will they sustain any further? Is the world the same as the past 100 years?
In China and Taiwan (and Japan), tea farmers and producers are selling to the market at will. The structure of the tea economy is therefore quite flat. It has thus become an open field for competition, whether for sales or for production resources, such as laborers. The tea is a bit more expensive than that from elsewhere, but such structure puts the Western invented “Fair Trade” to shame. The Taiwan case is worth the mention (not that any system is without freud): in order for the typical small tea farms and workers to attain reasonable profits and salary, they have given up mass quality products and focus in finer ones. Its has been over 3 decades now. Tea is still prospering there.<blockquote class=”webkit-indent-blockquote” style=”margin: 0 0 0 40px; border: none; padding: 0px;”>
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There has been virtually no response on this posting in the forum where I posted it, where there are hundreds of people in the trade, a lot of them exporters and importers. I guessed it is too sensitive for most to comment on. Too many people live on the foundation of exploiting the under-priveleged of their countries and wanting to maintain the status quo.
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i agree leo but tea worker deep inside china mainland do not have so good money. some only is half. on the other side, i know some in ceylon not as high in india, not 2 usd a day. only 1. very poor, very dirty little houses with no floor. china is garden of eden to compare these places. because small family factories can sell tea to market directly
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In my opinion, it depends on innovations in breeding and mechanization. The invention of the mechanized tea rollers helped keep the cost of standard tea down even as labor prices went up. The invention of clonal tea had a similar impact. Now the issue is with plucking. No one has invented a machine that can mechanically pluck tea as well as human pluckers can. For now, the process still works using hand-pluckers because of the very low cost of labor and the difference in exchange rates between most tea producing areas and tea consuming areas. I predict, however, that soon the rest of the tea world will have to follow the lead of Japan; investing a lot of money into tea research in order to keep the prices competitive while costs of labor rise and rise, and to attempt to counteract the decline in quality that mechanical harvesting creates by introducing other scientific innovations.
As for human rights, that is a very serious issue in almost all of the tea-growing regions. Under the plantation system, it is easier to monitor and regulate abuses, because all the tea processes and workers are present in the same spot. However, abuses will only be discovered through monitoring, as most plantations are in very isolated locations. This is the idea behind “Fair Trade” certifications and other such oversight programs. However, even with this, there are many social problems in the tea fields. Tea workers may overspend and get themselves into debt with moneylenders, and alcoholism can also be a problem.
Although smallholders are free from systematic abuse from plantation owners, it is also harder as a tea consumer to know if the tea is harvested responsibly, because it comes from so many areas, all independent. So if one farmer uses child labor, and another uses too many pesticides, it can be harder to locate those who are responsible once the tea has all been gathered together. It also makes it harder to tell who is responsible for providing welfare services. On plantations, it is mandated by law that the managers provide medical care for their workers (although whether or not they follow the law depends on oversight), but how could you make such a mandate of a refiner who buys teas from many different small farmers?
Also, when there are new innovations in technology, they are harder to spread among small farmers than among large plantations. Instead of one new improved rolling machine, you would need many. Instead of one field to replant with an improved clone, there would be many different areas, all independent.
It is certainly a complex issue, and I suspect the tea world will go through many major changes in the next few decades. -
good practice is governed by peer pressure and market economy. you should see the difference by going to see plantation worker by large company and small farmer in china. big difference. talk and thinking no use. work and seeing big difference. certified organic and fair trade need human practice. you should witness bad practice of these “good” plantations.
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I think the introduction of machines won’t help. It creates other problems, this can be seen all over the world since industrialization began. Machines aren’t used to make people lives better (people could work less hours for the same amount of money), but instead machines substitute people who end up without jobs or working for even less money because they are afraid to lose their jobs.
One thing that could help, maybe.. is the union of the small tea producers, so that they would help each other instead of fighting to see who will get the sale. I don’t know how this could be done, if it can be done… but I guess it could be a way. They need to help themselves.The manufactured tea will always be of superior quality and there is people willing to buy it. The producers need to know how good their tea is and get a good price for it.There’s no use in producing more. They should try producing better instead.Just some thoughts. I’m really alien to chinese/indian economy. -
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Did anyone see this article in The Economic Observer? I know that tea workers heading to the city for higher-paying jobs has been an issue in southern India for a while… it looks like it is starting to become an issue in China as well.
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Thx for posting the article. The issue is exactly one major reason why tea plucking daily wages have gone up so rapidly in recent years. This year, some regions report 150 RMB (approx $21) a day and food, boarding, and traveling provided.
The interesting thing is although the report cited an Anxi county story, the photo of the leaf gatherers is in some other region using a cutter (the tea trees are not oolong cultivars too), which traditional oolong regions do not employ. It actually raises a significant question, whether the editor of that article intends it or not: are we going to see tea production costing going the extremes — traditional hand-plucked teas becoming extremely expensive because of the rising cost of labour, while the majority of the market will be forced to cut leaf teas? Or are we already “progressing” in this direction? -
I forgot: reference this Tea Guardian article:
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