Organic Tea Market size was valued at $ 306 Million by 2019, and is anticipated to grow at a CAGR of 6.7% during the forecast period 2020-2025. The Organic Tea Market growth rate is attributed rising importance of flavonoid-based food and beverages, which have antioxidant properties coupled with growing concerns related to the harmful effects associated with cadmium on human health. Organic tea refers to a tea that is grown without pesticides and insecticides being used. If consumed in the correct amount, high quality organic tea can have substantial beneficial effects on the body. It helps with digestion, strengthens the skin, helps to lose weight and decreases the risk of heart disease. Several types of organic tea are available on the market. White tea, oolong tea, Green tea, and Black tea are among some of these. Owing to their health benefits, organic tea products are used as an ingredient in a large range of food and beverages. They are commonly used in baked goods, confectionery products, and chocolate products. By launching new organic tea product lines, manufacturers are making efforts to grow their market share, attract new customers and maintain the old customer base.
Organic Tea Market Segment Analysis – By Product Type
On the basis of product type, Camellia sinensis-based segment held the major share of the market in terms of revenue and is poised to grow with a CAGR of 4.8%. It is reported that the black organic tea segment holds a dominant market position. In addition, the organic green tea market is poised to rise in the given forecast period owing to the growing knowledge among people about the health benefits obtained from green tea. The ease of accessibility has led to a wider worldwide penetration of the product. In addition, industry players have been increasingly spending on creating creative products under the categories of white, black, green, and oolong to meet the taste and health indicators of all.
In addition, the herbal tea segment is anticipated to witness the fastest growth during forecast years 2020-2025. The rapid development is owing to raising consciousness among generations about healthy lifestyles. Under the groups, there are a large number of product varieties, such as chamomile, peppermint, ginger, hibiscus, eBrazilcea, rooibos, sage, lemon balm, rose and passionflower.
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Organic Tea Market Segment Analysis – By Geography
Asia-Pacific dominated the Organic Tea Market with a share of 38% in 2019. The application of Organic Tea has grown rapidly over the last few years owing to increased investment and expansion by the major key players in the emerging countries of this region. In most Asian nations, tea is considered a serious affair. The consumption of tea in the area goes all the way back to the beginning of the region’s documented history. In addition to morning meals, during mid-day breaks, and with friends and family, people enjoy tea. In China, Japan, India, Myanmar, South Korea and Taiwan, different types are eaten. The region is considered, along with being the largest buyer, to be the largest producer of variants of organic products. Furthermore, driven by the consumer demand to have authentic and a purer version of tea with minimal chemical exposure during production is boosting the demand for organic green tea in the region.
Central and South America are expected to register the fastest CAGR in the forecast period 2020-2025. The region’s consumers have been well versed in the good taste of the herbal tea varieties, including Yerba mate and guayusa, along with Camellia Sinensis related tea. It is anticipated that the strong popularity of such drinks in countries such as Brazil, Paraguay, Uruguay and Argentina will remain a favorable factor for the growth of the industry in this region.
Organic Tea Market Drivers
Widespread applications as a healthy food
As a nutritious food, organic tea has broad applications and is especially good for people suffering from obesity, heart disease, and high cholesterol. A major driver for organic teas is the rising market demand for safe food and beverage products. Tea is very common, without any major side effects, for reducing excess body fat and increasing the metabolic rate. The popular characteristics and the medicinally essential compounds present in the tea do not get lost because of the organic processing of the tea. This, relative to other items, makes it a better tea. Over the past few years, the industry has been witnessing an increased number of manufacturers who sell decaffeinated variants of organic tea. For instance, Twining and Company Limited, a U.K.-based tea company, sell decaffeinated green tea bags, which offer a smooth and balanced combination of taste and flavour.
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Organic Tea Market Challenges
Higher Price and Advancement in Substitutes
The price of organic tea is higher as compared to conventional tea as they are grown by all natural means. Hence, the higher price is to act as a hindrance to the market growth especially in lower per capita income regions. Moreover, owing to advancements in the organic coffee market, the organic tea market is anticipated to witness some retardation in the regions where coffee is the most consumed beverage.
Organic Tea Industry Outlook
Product launches, mergers and acquisitions, joint ventures and geographical expansions are key strategies adopted by players in the Organic Tea Market. In 2019, Organic Tea Market share is fragmented by the top ten players present in the market. Organic Tea Market top 10 companies are Barry’s Tea, Celestial Seasonings, Inc., Dilmah, Harney & Sons Fine Teas, Numi, Inc., Ito EN, Ltd., Organic India Pvt. Ltd., Tata Global Beverages, Taylors of Harrogate Ltd., Tazo Tea Co., The Republic of Tea and others.
In February 2019, Sequential Brands Groups Inc., in partnership with MindFull Inc. launched novel GAIAM organic green teas. The newly launched teas are USFA certified and are available in four exotic flavors.
In July 2018, Ito En Ltd., Japan’s leading green tea producers launched an organic Oi Ocha RTD for the US market.
Asia-Pacific dominated the Organic Tea Market with a share of 38% in the year 2019.
The factors such as increasing awareness amongst consumers about the harmful chemical constituents of most packaged food products and widespread applications as a healthy food are amongst the major factor projected to impel growth of Organic Tea Market.
Governments and various NGOs are also promoting organic farming practices for sustainable growth, leading to an opportunistic market for organic tea manufacturers coupled with innovative flavors of organic tea are the key factors owing to the growth in the segment during forecast period 2020-2025.
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