Sustainability Issues in the Tea Sector: A Comparative Analysis of Six Leading Producing Countries

Stichting Onderzoek Multinationale Ondernemingen, June 2008

110 Pages Posted: 18 Aug 2010

See all articles by Sanne van der Wal

Sanne van der Wal

SOMO - Centre for Research on Multinational Corporations

Date Written: June 1, 2008

Abstract

Tea is the second most popular drink in the world, after water. For a number of developing countries it is an important commodity in terms of jobs and export earnings. Tea production is labour intensive and the industry provides jobs in remote rural areas. Millions of livelihoods around the world depend on tea picking and processing. However, as with many other agricultural commodities, real primary producer prices have fallen dramatically over the last three decades. Low prices are affecting the sustainability of the tea sector, with working conditions and the livelihoods of plantation workers and smallscale farmers in tea producing countries under pressure. Meanwhile, tea trade and distribution is dominated by a few international companies that benefit from stable retail prices. In this report, SOMO is presenting for the first time ever a more detailed and comparative analysis on social, economic and ecological conditions in the tea sector in 6 of the most important tea-producing countries: India, Sri Lanka, Vietnam, Indonesia, Kenya and Malawi. The research is based on an extensive field study of civil society organisations in these countries, thus providing a unique perspective on this sector. The report also presents an overview of trade, production and stakeholders in international tea supply chains, and makes recommendations to various stakeholders for improving conditions, particularly for plantation workers and tea smallholders the most vulnerable in the tea industry. The study found that working conditions for pickers are often poor, with low wages, low job and income security, discrimination along ethnic and gender lines, lack of protective gear and inadequate basic facilities such as housing and sometimes even drinking water and food. At the same time there is no possibility for tea plantation workers to improve working conditions because trade unions are ineffective or absent and/or are not representing them because most of them are temporary workers. While tea production by smallholders is growing worldwide, their situation is often problematic because the prices they are paid for fresh tea leaves tend to be below the cost of production, among other factors. The sector’s environmental footprint is considerable, with reduced biodiversity as the result of habitat conversion, high energy consumption (mainly using logged timber) and a high application of pesticides in some countries.

Keywords: Tea Sector, Working Conditions, Sustainability, CSR, Consumption

Suggested Citation

van der Wal, Sanne, Sustainability Issues in the Tea Sector: A Comparative Analysis of Six Leading Producing Countries (June 1, 2008). Stichting Onderzoek Multinationale Ondernemingen, June 2008. Available at SSRN: https://ssrn.com/abstract=1660434

Sanne Van der Wal (Contact Author)

SOMO - Centre for Research on Multinational Corporations ( email )

Sarphatistraat 30
Amsterdam, 1018 GL
Netherlands

HOME PAGE: http://www.somo.nl

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