Need to Know (Sept. 3, 2013)

What you need to know to start the week.

  • CTC prices are sliding due to disruptions in trade with Egypt, the world’s fifth largest tea importer. Kenya, India and Sri Lanka are experiencing falling prices amid declining sales of the low- to medium-quality tea which they have in abundance. India is on track to export 230 million kilos and Sri Lanka has seen five-fold growth in production. Egypt normally imports 100 million kilos a year.
  • The U.K. is backing Canadian researchers who demonstrated iron-fortified tea could save the lives of hundreds of thousands of babies and their mothers at childbirth.
  • Tetley successfully convinced a U.S. Court to dismiss a lawsuit alleging it misled consumers with ‘antioxidant, nutrient content and health claims’ for tea products.

Health

TORONTO, Canada – Researchers at the University of Toronto have discovered a method of fortifying tea that could annually help save the lives of 600,000 babies and 100,000 anemic mothers.

This week the U.K. Department for International Development announced a $250,000 grant to develop the idea. Citing World Health Organization statistics in their announcement, International Development Secretary Justine Greening said a woman dies in childbirth every two minutes.

Dr. Levente Diosady, who conducted the research, discovered a new process to coat tea leaves with iron that is released when it comes in contact with hot water. The coating imparts no flavor. When it reaches the lower intestine it dissolves, providing essential iron.

The grant is part of a five-year “Saving Lives at Birth” program jointly financed by USAID, the Government of Norway, The Bill and Melinda Gates Foundation, Grand Challenges Canada and the World Bank. Learn more.

Retail News

Tetley Tea

Tetley Tea

Lipton, Rishi Tea and Ten Ren Tea all faced possible Federal Drug Administration fines in the past few years due to label claims that make the case that tea is rich in antioxidants and nutrients that contribute to good health. All three quickly complied with changes in wording on labels, online and in promotional literature.

In 2005 FDA concluded that existing evidence does not support qualified health claims for green tea consumption and reduced risk of certain types of cancer but last year the language was made less restrictive as follows:

  • Green tea may reduce the risk of breast or prostate cancer although the FDA has concluded that there is very little scientific evidence for this claim.
  • Green tea may reduce the risk of breast or prostate cancer. FDA has concluded that there is very little scientific evidence for this claim.

Last week Tata Global Beverages, on behalf of its Tetley USA subsidiary, succeeded in convincing a federal court to dismiss a lawsuit claiming the company’s labels and website statements were misleading and amounted to deception under California and Federal law.

In August 2012 the plaintiff, Daryl De Keczer, filed a formal complaint with U.S. District Court, Northern District of California, alleging that Tetley ‘Misbranded Food Products’ including Tetley Classic Blend Black Tea, British Black Tea, Pure Green Tea, Iced Tea Blend Tea and Iced Tea Mix.

In a report published by Beverage Daily, De Keczer alleged claims such as ‘natural source of antioxidants’ were illegal under the Food Drug & Cosmetic Act as adopted in California law.

Tetley “utilizes improper antioxidant, nutrient content and health claims that have been expressly condemned by the FDA in numerous enforcement actions and warning letters,” she wrote.

But in dismissing the 2012 complaint on August 16, US District Judge Edward Davila ruled De Keczer did not give a clear, unambiguous account of allegedly fraudulent, deceptive, misrepresentative or other allegedly unlawful statements.

Moreover, Davila said that statements on food or beverage labels – like the Tetley ones at issue – did not constitute express warranties against a ‘product defect’ under the Song-Beverly Consumer Warranty Act or Magnuson-Moss Warranty Act, De Keczer’s eighth and ninth causes of action, as reported by Beverage Daily.

Origin

Leaf quality is a good indicator of the care taken during the plucking and manufacture and while taste is paramount in selecting fine teas, a standard for green leaves is a useful measure of quality.

This is why the Tea Board of India is circulating guidelines that call for 65 percent of the each lot, by weight, to consist of very small soft leaves (called banjis) and fine shoots consisting of 2-3 leaves and a bud. Soft leaves make up the remaining 30 percent. No more than 5 percent of the lot can be coarse leaves.

Bought leaf factories must reject substandard lots and growers are forbidden to “shop around” seeking buyers that bend the rules. Factories that accept substandard leaves can lose their permit to operate.

The intent is to force small growers to carefully cultivate the tea, plucking only the best leaves. The incentive for improvement is better prices and greater price transparency. The Tea Marketing Control Order (TMCO) mandates that factories post average prices determined at auction for each district, a practice welcomed by the All Assam Small Tea Growers’ Association (AASTGA).

But the guidelines came under immediate criticism by growers represented by the North Eastern Tea Association (NETA). The group points out that 65 percent small leaf is fine for the spring harvest when leaves are small, but mid-summer and autumnal teas contain larger, mature leaves.

Leaf tea is currently selling at a very low rate INRs 12 ($0.18 per kilo). Many buyers annually negotiate mutually-beneficial rates with small growers that should be allowed to stand regardless of monthly variations in price, say critics.

NETA Chairman Bidyananda Barkakoty told The Times of India that growers welcome a minimum quality standard, but one that “provides appropriate allowance of unavoidable seasonal variations and ground realities.”

In his letter to Tea Board Chairman M.G.V.K. Bhanu, Barkakoty wrote that not just factories, but “all agents and suppliers, should be registered, trained and made responsible for quality improvements.

“The quality parameters should not only be confined to green leaf buyers; they should also be applicable to the estate factories manufacturing tea from their own leaves,” he wrote.

West Bengal Chief Minister Critical of Gorkha Leaders

The chief minister of West Bengal called on the people of Darjeeling to disregard calls to shut down the tea and timber operations by a political group seeking a homeland for Nepali-speaking Indians living in the foothills of the Himalayas. There are 10 million so-called Gorhkas living in northern India.

Minister Mamata Banerjee said the Gorkhaland Janmukti Morcha (GJM) is hindering development in the region. She called for a peaceful resolution that leaves West Bengal united. Banerjee also said the autonomous Gorkhaland Territorial Administration is stalling investment of $4.5 million which is exacerbating the situation. Learn more

Accolades

STONINGTON, Maine — Teas from Stonington’s Tempest in a Teapot will be featured in the swag bag given to celebrities at the 65th Emmy Award ceremony next month. The owners of the small start-up were shocked when they got the news, according to a report in the Bangor Daily News. “I thought it was a hoax,” co-founder Jennifer Larrabee told the newspaper. She launched the loose-leaf tea company with friend Sarah Burrin a year and a half ago.

Their blends of traditional teas with local herbs such as rugosa rose hips, which they grow on Deer Isle and procure from farmers, caught the attention of Tinseltown. Tempest in a Teapot makes more than 13 blends from Earl Grey to peony tea with blueberry, sweet mango and lime.

“We are a very small company owned by two stay-at-home moms. For us to be asked to do this is an incredible opportunity for us and our community,” Larrabee told the newspaper. “We are ecstatic.”

Tea Whimsy

Colossal Titan Tea Strainer

Colossal Titan Tea Strainer

Japanese hobby shop ACG will release in October a clever tea strainer and mug combo featuring the Colossal Titan from the popular manga and animé series Shingeki no Kyojin aka Attack on Titan cartoons.

You can pre-order the Tea Strainer and Mug from AmiAmi for $18. Learn more.

Tea Biz serves a core audience of beverage retailers in the belief that insightful journalism is one of the most effective forms of professional education. We write about what matters along the entire supply chain, emphasizing trustworthy sources and sound market research while discarding fluff and ignoring puffery. If there is nothing we can add to your understanding of the issue, we leave it alone.

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