The flavoured tea market is growing very fast in India, as several organised players in the industry are entering the competition, mostly among the youth, the Tea Board of India said.
The demand for such functional or herbal teas has increased in the country, particularly after the onset of COVID-19, as tea with spices and natural herbs has proved to boost immunity against the virus. The size of the flavoured tea market in terms of volume and price is around 60 million kilos and Rs 3600 crore, respectively.
The official said that this is, however, an approximate value, taking the flavoured tea market to be 10 per cent of the entire packet tea consumption. Kamakshya Singh, head (business development) of Luxmi Tea, said that functional and herbal tea consumption has gained momentum in recent years. Luxmi Tea will shortly launch online channels for selling such teas.
Younger audiences are embracing wellness as a result of the pandemic. Brands are now focusing on holistic wellness, which includes an active lifestyle, for which such tea blends are gaining popularity.
E-commerce volumes for selling such tea online are rising 30 per cent each year, while the estimated share of the herbal or functional tea market would be less than two per cent.
The functional tea market in India is around 0.5 per cent of India’s domestic consumption while growth in this category can be safely estimated at 40 per cent to 45 per cent per annum. Sources in the industry said that many start-ups in the tea sector are betting big on such functional tea as they are getting a good response.