Need to Know

Tea Industry News for the week of June 8

  • Theaflavins Inhibit Virus Replication
  • Immunity is the Epicenter of Health Enhancing Foods
  • Water Works Wonders
  • Digesting Grubhub
  • Tea for the Front Line

“Now is the time to play the health card” I advised during a June 10 webinar on Tea Vulnerabilities hosted by the European Speciality Tea Association (formerly known as The European Tea Society).

Click here to watch a recording of the webinar.

Recent scientific articles* suggest that black tea polyphenols derived during the oxidation of tea catechins could potentially inhibit the ability of the coronavirus to replicate.

RNA replication in the coronavirus is a two-step mechanism that relies on the RdRP (RNA-dependent RNA polymerase) protein to catalyse the synthesis of the RNA strand.

Authors of a March article in the Journal of Medical Virology conclude that “theaflavin could be used as a lead compound for developing a SARS‐CoV‐2 inhibitor that targets RdRp. However, the exact in vivo effect is still unclear, and further research is needed to confirm the mechanism whereby theaflavin target SARS‐CoV‐2.”

Medical researchers in Taiwan recently concluded an investigation of 720 compounds listed in the Natural Product Libraries for anti-COVID-19 efficacy. The list was narrowed to 10 compounds and mixtures that had strong potential for anti-COVID-19 efficacy, according to Dr. Bashar Khiatah. “The compounds that have been found to have an anti-COVID 19 effect are the polyphenols that are found in teas,” writes Amylee Amos, MS, RDN.  These are found in black tea, green tea, oolong tea, and pu-erh. The most promising is Theaflavin-3,3′ -digallate (TF3) which is converted from catechins during fermentation.

Researchers in 1998 found tea theaflavins completely neutralized bovine coronavirus and rotavirus infections. In 2005 Chinese researchers showed that black tea significantly inhibited chymotrypsin-like protease activity essential to virus reproduction. Recent in-vitro studies found TF3 completely inhibited COVID virus replication in cell cultures.

The Indian Council of Medical Research (ICMR) announced that it will study Theaflavins’ antiviral properties.

*View research paper abstracts and links at end of this report.

Immunity is the Epicenter of Health Enhancing Foods

The polyphenols in tea are known to boost immunity and combat inflammation. Health institutes worldwide have for several years recommended eating foods and beverages that reduce inflammation and naturally boost the body’s immune system.

Due to the pandemic this health message has captured the attention of consumers who are increasingly seeking out products to boost their immune system, according to a post-pandemic study by Unilever’s CMI U-Futures and CMI People Data Centre.

Unilever found that in the US the intake of vitamin supplements in March rose by 15% in the space of a month. In Brazil consumers are bingeing on vitamin c-rich fruits and in Japan, yogurt formulated to boost the immune system saw a spike in sales.

Just Food reports that in Israel, interest in immune-system supportive ingredients rose 66% in March. According to AI-focused market research firm Tastewise, “we expect the trend to continue to rise. Immunity, stress relief, medicinal benefits and more are all skyrocketing.”

In China, a post-Covid-19 study of consumer behavior by McKinsey & Co. found that 70% of consumers intend to “work to boost their own physical immunity by exercising more and eating healthy.”

A review of ingredients used by at-home cooks shows a preference for wholesome, lean foods which may be influenced by studies showing obese victims are less likely to survive COVID-19.

The desire for health and well-being post pandemic is a consistent trend across all markets,”​ Unilever concluded. Unilever CEO Alan Jope told analysts “anything that’s in the space of wellness – health and well-being – is going to enjoy sustained strength.”

Having an optimally working immune system is more important than ever. The way our body deals with an infection is influenced by many factors of which the nutritional status is a critical element,”​ Dr Angelika De Bree, Unilever’s global nutrition director, explained to the The Food Navigator..

“Our biggest food brands offer thousands of products and recipes which are nutritious, affordable and made with sustainably sourced ingredients,” according to Dr. De Bree.

Tea is clearly the ideal beverage for the situation at hand.

Our tea and herbal category delivers healthy hydration through Earth’s most sustainable plant-based drinks,she said.

Water Works Wonders

The UK Tea Academy released a white paper describing “The Ultimate Ingredient for The Perfect Cup of Tea” – that being water.

“Water, which makes up to 99% or more of a cup of tea, is an often-overlooked ingredient that has a huge impact on the taste, aroma, and appearance of every cup. Following research of many different teas and many different waters, this paper finally provides the ideal water specification need to make the best brew,” writes Jane Pettigrew, one of three principal authors of the 12-page report.

The white paper highlights the key ingredients of water which impact the brewing process of tea. It also describes a standard water specification to create the optimal cup of tea.

Click to download the document here.

Water used to brew tea has not been considered in the same way as water for coffee, according to the report.

If the ideal water is not used, the delicate notes of tea cannot be realized, resulting in a bad experience with even the finest of teas. Sadly, this leads to a lack of consumer confidence as well as misconceptions of how certain teas taste.

“A perfect example of this is green tea. It is very common for people to “think” that they do not like green tea, the opinion reached because the tea has been almost certainly made with unfiltered water, at the wrong temperature and over-brewed. The entire flavor profile is altered, often leaving the tea bitter and undrinkable. Brew a green tea correctly and the entire experience is worlds apart in comparison,” writes Pettigrew.

The report delves into the chemistry of water, describes the importance of removing chlorine and preserving the the buffer capacity of the water, a delicate balance of calcium and magnesium that defines ideal “hardness.”

Retailers and tea traders should view this work as an excellent resource and, like those in the coffee world, they should adopt a water standard when tasting tea.

The specification appears below.

Digesting Grubhub

European food delivery venture Just Eat Takeaway derailed what looked like a pre-destined Uber takeover of Grubhub this week.

In May San Francisco-based Uber Technologies was set to acquire Chicago-based Grubhub to become the largest online foodservice delivery firm in the US. Haggling over price, and the likelihood of antitrust scrutiny, killed the deal which was valued at several hundred million (Uber offered $62.50 per share).

In June, Amsterdam-based Just Eat Takeaway offered the equivalent of $75.15 per Grubhub share. Just Eat (UK) and Takeaway (The Netherlands) combined their businesses in April, and now control a huge share of Europe’s growing market for both delivery and food delivery software.

Packaged Facts analyst Cara Rasch said the deal “will allow Just Eat Takeaway to gain a larger footprint in North America, and diversify Grubhub’s business. Skip the Dishes, a subsidiary of Just Eat Takeaway, does a lot of business in Canada and could help the Grubhub brand expand more broadly through North America.”

“In the short-term, third-party restaurant delivery apps have a number of advantages over in-house delivery,” she explains. “They are convenient for consumers because they allow customers to order from a variety of venues using one application. They also can allow smaller businesses without the capital to invest in in-house development of effective online apps to expand their delivery services quickly in the wake of COVID-19, which has forced fast changes,” writes Rasch, but restaurants consider the commissions that third-party online delivery companies charge to be a burden. “If they don’t raise their prices for meals ordered via a third-party app, they are in danger of losing money in an already tight-margin business that has been threatened by lower overall restaurant sales during the pandemic,” she said.

The outlook for carryout and delivery is bright due to distancing guidelines that have shuttered dine-in service or forced restaurants to greatly limit their dine-in capacity.

Long term, “many restaurants are going to see the value of investing in an in-house system for delivery orders. Using a third-party company for ordering and delivery makes it harder for restaurants to develop a direct relationship with consumers. It is also challenging to ensure food quality since restaurants have no control over the food once it leaves the restaurant,” she said.

Source: Packaged Facts, Food-Carryout & Delivery

Tea for the Front Line

The Tea Spot launched its new Flu Fighter tea, a caffeine-free herbal blend that features functional ingredients, including astragalus, honeysuckle, organic licorice root, orange peel, tangerine peel, dandelion root, mulberry leaf, red root and organic ginger.

Flu Fighter Tea

The ingredients in the new Flu Fighter tea were chosen based on a recent medical report, published in Military Medical Research (Volume 7, Article Number 4, February 2020), on the diagnosis and treatment of the novel coronavirus (2019-nCoV), where a combination of herbs and roots were used to support flu-like symptoms.

According to Maria Uspenski, founder and CEO of The Tea Spot and author of Cancer Hates Tea, many of the natural herbs in this sweet, nourishing tea were also used in ancient times to make wellness broths for recovery and building strength. And while the Flu Fighter tea is meant to be supportive and maintain wellness, it is not meant to treat, cure or prevent any disease or ailment.

“The pain and stress of the current pandemic has pushed The Tea Spot to think outside the box as to how we can help empower people to find and support better overall wellness,” said Uspenski. “The result of our efforts is our aromatic and medicinal Flu Fighter herbal tea, inspired by recent medical research. This supportive tea is intended to be used in combination with social distancing, good personal hygiene, sound diet, ample exercise and rest, while it encourages wellness and facilitates calm amidst the turmoil and uncertainty that’s happening around the world.”

The Tea Spot donates 10% of all profits in-kind to cancer survivors and community wellness programs. In May The Tea Spot donated 55,000 specialty tea sachets to first-responders in New York, California, and Texas.

Footnote: The US Census Bureau on June 8 announced a very helpful online resource for understanding and keeping up with the impact of COVID-19. Visit: COVID-19 Data Hub (https://covid19.census.gov/).

THEAFLAVIN REFERENCES
*Jrhau LungYu‐Shih LinYao‐Hsu YangYu‐Lun ChouLi‐Hsin ShuYu‐Ching ChengHung Te LiuChing‐Yuan Wu |The potential chemical structure of anti‐SARS‐CoV‐2 RNA‐dependent RNA polymerase | First published: 13 March 2020 https://doi.org/10.1002/jmv.25761
Chen CN, Lin CP, Huang KK, et al. Inhibition of SARS-CoV 3C-like Protease Activity by Theaflavin-3,3′-digallate (TF3). Evid Based Complement Alternat Med. 2005;2(2):209–215. doi:10.1093/ecam/neh081
Clark KJ, Grant PG, Sarr AB, Belakere JR, Swaggerty CL, Phillips TD, et al. An in vitro study of theaflavins extracted from black tea to neutralize bovine rotavirus and bovine coronavirus infections. Vet Microbiol. 1998;63:147–57.
Ksiazek TG, Erdman D, Goldsmith CS, et al. A novel coronavirus associated with severe acute respiratory syndrome. N Engl J Med. 2003;348(20):1953–1966. doi:10.1056/NEJMoa030781
Hegyi A, Friebe A, Gorbalenya AE, Ziebuhr J. Mutational analysis of the active centre of coronavirus 3C-like proteases. J Gen Virol. 2002;83(Pt 3):581–593. doi:10.1099/0022-1317-83-3-581
Leung WK, To KF, Chan PK, et al. Enteric involvement of severe acute respiratory syndrome-associated coronavirus infection. Gastroenterology. 2003;125(4):1011–1017. doi:10.1016/s0016-5085(03)01215-0
Herold J, Gorbalenya AE, Thiel V, Schelle B, Siddell SG. Proteolytic processing at the amino terminus of human coronavirus 229E gene 1-encoded polyproteins: identification of a papain-like proteinase and its substrate. J Virol. 1998;72(2):910–918.
Muhammad Tahir ul Qamar, Safar M. Alqahtani, Mubarak A. Alamri, Ling-Ling Chen, Structural basis of SARS-CoV-2 3CLpro and anti-COVID-19 drug discovery from medicinal plants†,Journal of Pharmaceutical Analysis,2020,ISSN 2095-1779,https://doi.org/10.1016/j.jpha.2020.03.009.
Zhavoronkov, Alex; Aladinskiy, Vladimir; Zhebrak, Alexander; Zagribelnyy, Bogdan; Terentiev, Victor; Bezrukov, Dmitry S.; et al. (2020): Potential COVID-2019 3C-like Protease Inhibitors Designed Using Generative Deep Learning Approaches. ChemRxiv. Preprint. https://doi.org/10.26434/chemrxiv.11829102.v2
Chen CN, Liang CM, Lai JR, Tsai YJ, Tsay JS, Lin JK. Capillary electrophoretic determination of theanine, caffeine, and catechins in fresh tea leaves and oolong tea and their effects on rat neurosphere adhesion and migration. J Agric Food Chem. 2003;51:7495–503.

Need to Know (Sept. 9, 2013)

What you need to know to start the week.

  • Unilever buys T2, Australia’s $50 million market leading tea retailer.

Retail News

T2 Logo

T2 Logo

COLLINGWOOD, Victoria – Unilever kicked off their retail shop game with a Lipton store 15 years ago but later fumbled the ball in Belgium and stumbled with Bru World Cafes in India. Last week’s surprise acquisition of T2, Australia’s top specialty tea retailer, puts Unilever’s retail team back in the game.

Unilever has much to learn from T2, a premium tea retailer founded in 1996 by Maryanne Shearer in Fitzroy, Australia. The company currently operates 40 stores, mainly in Melbourne. T2 reported 12-month sales of $52.5 million through June of this year. The tea company offers a range of blended teas found in specialty grocery as well as many leading cafes, restaurants and hotels in Australia and nearby Asian countries. The company, which employs 300, opened 11 retail stores in the past year including its first in New Zealand and “has been growing double-digit and has significant potential,” according to the Unilever press release announcing the deal Friday, Sept. 6. The purchase price was not disclosed.

T2's Chappel Street Shop

T2’s Chapel Street Shop

The acquisition “will allow us to bring the benefits of scale and access to new markets to the T2 business and for both businesses to share tea category expertise,” said Unilever’s President of Refreshment Kevin Havelock.

“We also like the fit with T2, bringing a fast-growing, premium tea business to complement our portfolio that we can leverage like we have done with other acquisitions in other categories (e.g. TRESemme that came with the Alberto Culver acquisition and which we have quickly launched in new countries like Brazil and Indonesia),” added Trevor Gorin, Unilever Head of Global Media Relations.

“We are delighted that we have found a home for T2 that has such a depth of knowledge of tea and has pioneered sustainability in the industry,” said T2 Managing Director Shearer. “Both I and the T2 team are looking forward to working alongside new colleagues in Unilever’s tea business to realize the full potential of the business we have spent the last 17 years building.”

Dynamic Business reported that “Shearer’s teas enjoy cult-status amongst connoisseurs and modern drinkers alike, and she’s built a booming retail business at a time when many are folding… using her product development and visual merchandising skills (Shearer) created a retail experience Australians hadn’t seen before.”

TEABIZ-T2MaryanneShearer_Tasting3_200px

CEO Maryanne Shearer

Shearer, 50, who has twin boys and a 12-year-old daughter, is recognized as one of Australia’s top entrepreneurs. She operated a homeware company prior to founding T2 and worked in the fashion and interior design industry early in her career.

“Maryanne Shearer has created a whole new retail category and built a powerful brand in her T2 business,” said Janet Holmes à Court, chair of the Australian judging panel that awarded Shearer the 2012 Veuve Clicquot Business Woman Award.

“What was the hardest part about establishing T2?” Dynamic Business asked her in 2012.

“In the beginning it was convincing everyone that a retail tea concept was a viable business idea, then once we were trading and the idea took off, it was understanding the importance of a healthy business and finding the balance between left and right brain priorities,” she answered.

T2 Retail Store

T2 Retail Store

Shearer clearly gets it. T2’s teaware selection is functional with vibrant eye-catching design. Her first shop featured daily in-store tastings, open canisters displayed on tables and staff trained to encourage customers to smell, touch and compare teas. The shops are a model of what is unfolding in the United States and a tested platform for Lipton to expand globally.

While the company is smaller than either the 100-store DAVIDsTEA headquartered in Montreal, Canada or the 300-store Teavana, T2 similarly pioneered the winning retail concept in its home market and is now Australia’s leader in specialty tea.

Blends like Strawberries and Cream (which retails for $31 for 250 grams) and Citrus Punch ($12.80/100 g), Organic Chai ($12.40/100 g) and orthodox teas like Iron Goddess of Mercy ($45/100 g) are marketed at prices familiar to Teavana or DAVIDsTEA customers. Stores feature a tea wall, offer samples and tastings as well as more formal personalized training for their best customers.

The hip three-tiered loyalty program rewards 25 credits after $500 in purchases. Points are worth $1 each and redeemable in-store and online. T2 customers are invited to the Secret Tea Society after buying $2,500 in goods, a threshold that earns private tea training and “a multitude of niceties.”

T2 Tea

Selection of T2 Teas

Last November Starbucks paid $620 million for Teavana, a publicly traded company with margins superior to the coffee giant. Acquiring T2 (regardless of price) is a potential game-changer for Unilever which is not known for its loose leaf offerings and must expand its range to include premium tea brands. The T2 brand will add retail dollars to an already lucrative Australian portfolio that includes 125-year-old Bushells, a national brand founded in Queensland.

See: How much of a premium does it take to make premium tea special?

According to Euromonitor International, the Lipton and Bushells brands led Australia’s tea market in 2012 with 31% off-trade value share.

T2 Bottled Teas

T2 Bottled Teas

“Despite gaining in actual sales terms, Unilever’s value share slipped one percentage point from 2011, as the instant tea category expanded beyond Lipton Chai Latte and Bushells, resulting in the company’s off-trade value share dropping from 66% in 2011 to 58% in 2012 within instant tea despite gains in actual sales terms.

Details on the market can be found in the April 2013 report: Tea in Australia.

The purchase brings to mind Lipton’s two-year experiment in tea retail in Old Town Pasadena, Calif. The Lipton Tea House opened in 1997 with 52 kinds of loose leaf teas unavailable in other channels. The storefront’s light wood and chrome interior resembled Starbucks coffee houses. Patrons could order scones and a tea latte − made from tea, milk, cinnamon and other spices.

“The idea is to show consumers how interesting and diverse tea can be,” Gasper Ferraro, then-director of finance for Lipton’s food service division, told London-based Design Week in February 1999.

The venture could not meet revenue targets and was closed in 1999. Unilever’s Bru World Café a small chain of coffee shops that opened in July 2011 in Mumbai, now with three locations, continues to struggle. These attempts at store front retail and a European retail concept that failed in Belgium take on new relevance as Starbucks tweaks the already-successful Teavana model, with plans to expand into urban and suburban lounges in America as well as overseas.

Rumors this time last year predicted Unilever would open retail tea shops in Britain in 2013. Will Unilever instead supercharge T2’s already ambitious expansion plans?

Tea is a strategically important category for Unilever Australia, said Unilever Australasia chairman, Clive Stiff, “Our Lipton and Bushells brands are two of Australia’s oldest and best loved tea brands … We know tea drinkers are increasingly looking for new and diverse tea flavors, so we are delighted to be bringing T2’s premium and exciting range into the fold. T2 is a great Australian success story – a story that we now intend to continue with Unilever.”

T2 Tea Wall

T2 Tea Wall

The company website notes: “T2 has unfurled and blossomed over the last 17 years, and now sells enough tea per month to make 8 million cups!”

Australia has a population of 22.7 million who share a British tea habit that once rivaled the motherland. Per capita tea consumption was 2.67 kilos in 1964 but dropped by half to 1.3 kilos in 1985 as coffee became popular and soda sales rose to 73.10 liters per person. Consumption at half a kilo still lags the 1.9 kilos per capita consumed in the U.K., according to statistics compiled by the Food and Agriculture Organization of the UN.

Tea is making a strong showing in the market with a health and wellness message that resonates with young people, according to Shearer who credits travel for inspiring her creativity.

“Creating a wonderful taste experience with teas from all over the world gives T2 the opportunity to educate, excite and surprise T2’s customers,” she writes. “The customer experience is always our priority and that’s why we love what we do.”

Online the company states that: “Tea lies at the very heart of the T2 philosophy. Sourced from all over the globe, there are over 200 teas in our ever-expanding range, embracing all varieties. From the fanciful flavors and scents of herbal and fruit tisanes, to the revered tender white teas, the herbaceous greens, to the strong and heady popular blacks, the T2 tea range is multifaceted and full of adventure.”

The acquisition is subject to customary closing conditions, according to the release. Learn more.

Export News

HAMILTON, New Zealand – Zealong Tea Company continues in business despite reports of its demise, according to its owners.

The miscommunication stems from the arrival of bulldozers at the estate’s original farm on the northern edge of Hamilton. The 27-acre parcel was sold to residential developers following complaints from neighbors that the company used noisy helicopters to combat frost on the fragile leaves of its oolong stock.

Spokeswoman Gigi Crawford told NZ Farmer that the Gordonton house and Discover Tea experience remain in operation. Ten years ago when planted the farm was well removed from housing. It was subsequently zoned for residential use. Neighbors in the vicinity complained at the use of helicopters to circulate air and prevent frost damage.

The company which exports premium organic oolong and other teas to Asia and Europe will focus its attention on developing lands near Gordonton, investing up to $5 million in a new visitor center and leaf drying plant, according to Crawford.

Health

HOBART, Tasmania – A doctoral student at the Menzies Research Institute has demonstrated green tea prevents rats from getting diabetes.

Helena Ng, a doctoral candidate at the Institute, told The Daily Telegraph that her discovery in rats was made possible by a new test that detects early signs of diabetes. Her work adds to studies that suggest components in green tea may prevent, but not cure diabetes.

Rats fed an unhealthy diet that normally led to the early stages of diabetes avoided the condition when the diet included concentrated green tea, the equivalent of 200 cups a day.

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