Tea Market – Trends Forecast Till 2031

Market Snapshot

Market Overview

The global Tea Market size was estimated at USD 17,478 million in 2024 and is projected to reach USD 25,935.31 million in 2031 at a CAGR of 5.8 % during the forecast period 2025-2031.

The tea market is a significant sector within the global beverage industry, encompassing various types of tea such as black, green, white, oolong, and herbal teas. It is one of the most consumed beverages worldwide, with a rich history dating back thousands of years. The market is driven by the growing health consciousness of consumers, as tea is perceived as a natural, low-calorie drink with numerous health benefits. With an increasing demand for functional beverages, tea’s antioxidant properties and potential health benefits, such as promoting heart health and aiding in weight management, have made it a popular choice among health-conscious individuals.

The scope of the tea market covers both traditional and modern retail channels, with major players in the market offering loose-leaf tea, tea bags, and ready-to-drink tea products. Geographically, the market is diverse, with Asia-Pacific being the largest consumer due to the high tea consumption rates in countries like China and India. The market also includes growing demand in North America and Europe, where consumers are increasingly turning to premium, organic, and specialty tea blends. Online retailing and the growth of specialty tea shops have further expanded the reach and availability of tea products worldwide.

The trends driving the tea market are centered around health and wellness, with consumers seeking beverages that align with a healthier lifestyle. The rise in demand for organic and sustainably sourced tea is also a key trend, as consumers become more conscious of environmental and ethical considerations. Additionally, innovations in tea flavor profiles and product offerings, such as tea infusions with herbs, fruits, and spices, are appealing to younger and more adventurous consumers. The increasing popularity of iced tea and ready-to-drink tea beverages, especially in Western markets, is another trend contributing to market growth.

Several factors are influencing the growth of the tea market, including the growing interest in healthy and functional beverages, rising disposable incomes, and changing consumer preferences toward premium and organic products. Increased focus on sustainable sourcing practices and ethical production has also contributed to the market's expansion, as consumers prioritize brands that align with their values. However, challenges such as fluctuating raw material prices, climate change affecting tea production, and intense competition from other beverage categories pose potential hurdles. Despite these challenges, the tea market is expected to continue its growth trajectory, driven by ongoing product innovation and the increasing global demand for healthier beverage options.

Impacts USA tariff rates on the Tea Market

The imposition of President Trump’s tariffs in 2025, particularly the 15% tariff on imported tea products effective April , has significantly disrupted the U.S. tea market, which relies on imports for 90% of its supply. These tariffs, targeting black, green, oolong, and herbal teas from major exporters like China, India, and Sri Lanka, have driven up costs across the supply chain. Retail prices for consumers have surged, with specialty teas like Darjeeling and match seeing the steepest increases, eroding purchasing power and dampening demand among urban consumers. Small businesses, including tea shops and cafes, face squeezed margins as they absorb higher costs or pass them on, risking customer loss. The policy, framed as a boost for domestic tea production, has been criticized as misguided, given that U.S. fields meet less than 3% of demand, leaving the market vulnerable to supply chain strains and heightened trade tensions

Delvens Industry Expert's Standpoint

Experts in the Tea Market highlight several key trends driving growth and innovation. The tea market is a significant global sector driven by the increasing demand for healthy, functional beverages. With types like black, green, and herbal tea, it caters to health-conscious consumers seeking natural drinks with benefits such as antioxidants and heart health promotion. The market is expanding across traditional and modern retail channels, with a notable growth in organic and premium teas, especially in regions like Asia-Pacific, North America, and Europe. Trends like sustainable sourcing, innovative flavors, and the rise of ready-to-drink tea are shaping the market. Despite challenges such as fluctuating raw material prices and climate change, the tea market continues to grow, driven by evolving consumer preferences and a focus on health and wellness.

Analyst view on the impacts of U.S. tariff rates on the Tea Market

Looking ahead, the tea market faces a challenging yet dynamic future shaped by ongoing trade uncertainties and shifting consumer behaviors. Retaliatory tariffs from key exporters like India and China could further constrict supply, pushing prices higher and forcing retailers to seek alternative sources, such as smaller producers in Africa or Southeast Asia, potentially diversifying but destabilizing established trade networks. Consumer preferences may pivot toward cheaper, domestically blended teas or substitutes like coffee, as price sensitivity grows. However, niche markets for premium, sustainably sourced teas could thrive among affluent buyers, provided supply chains adapt. Legal challenges or congressional pushback against the tariffs might ease pressures, but persistent global trade frictions suggest a volatile outlook, with innovation and resilience critical for stakeholders to navigate this turbulent landscape

Market Portfolio

Key Findings

• Based on Product: The tea market is primarily segmented based on the type of tea products offered to consumers. Black Tea is the most widely consumed tea globally, known for its strong flavor and higher caffeine content, making it a favorite for daily consumption. Green Tea, often marketed for its health benefits such as antioxidants, is a popular choice among health-conscious consumers, especially in Asian markets. Oolong Tea is a partially fermented tea, offering a balance between black and green tea, with a flavor profile that appeals to a more niche market. Herbal Tea is technically not made from the Camellia sinensis plant but includes blends made from various herbs, fruits, and flowers. It's favored for its wide range of flavors and perceived health benefits, such as relaxation and digestion aids. This segmentation plays a significant role in consumer preferences and the overall growth of the market, with each type of tea catering to distinct tastes and needs.

• Based on Distribution Channel: Tea products are distributed through various channels, each reaching different customer bases. Hypermarkets are large retail stores that offer a broad selection of products, including a wide variety of tea brands. They account for a significant portion of the market share, as they cater to mass consumer demands and provide convenience for purchasing in bulk. Convenience Stores offer tea in smaller quantities, catering to on-the-go consumers who prefer quick and easy access to tea. These stores typically have a smaller selection but are popular for impulse purchases. Specialty Stores focus on premium and organic tea products, often providing a curated selection of high-quality teas. These stores appeal to discerning tea drinkers who are looking for unique blends or health-focused products. The distribution channel segmentation helps brands target different consumer segments effectively, optimizing their reach based on purchasing habits.

• The market is also divided into various regions such as North America, Europe, Asia-Pacific, South America, and Middle East and Africa. Asia-Pacific region is projected to hold the largest market share. Factors such as Rising Health Consciousness, Growing Popularity of Herbal and Green Tea, Increasing Disposable Income, Expansion of E-commerce, Growing Demand for Ready-to-Drink (RTD) Tea, Rising Consumer Awareness of Tea’s Health Benefits, Increasing Preference for Organic Tea, Urbanization and Changing Lifestyles, Innovation in Tea Flavors and Formats, Rising Demand from Emerging Markets have triggered the Tea Market in the region.

Regional Analysis

Asia-Pacific to Dominate the Market

• In Asia-Pacific, the market is dominated by countries like China, India, and Japan, which are not only the largest producers but also the highest consumers of tea. The region's market is driven by the strong cultural ties to tea, with both green and black tea being widely consumed across the population. China and India, being major tea producers, have established a global presence through exports, further bolstering market growth. Additionally, the growing trend of health-conscious consumers in these countries is pushing the demand for green tea and specialty teas. With expanding tea consumption beyond traditional markets, the region holds the largest share of the global market.

• In Europe, tea consumption is largely concentrated in the UK, Russia, and Turkey, where tea is deeply rooted in social culture. The region is seeing an increasing preference for premium and flavored teas, along with the growing trend of wellness-oriented products like herbal and green teas. The UK, in particular, continues to be one of the largest per capita consumers of tea. Additionally, the expansion of tea-based ready-to-drink (RTD) beverages has contributed to market growth in the region. The European market is also driven by innovations in packaging and the introduction of functional teas catering to specific health benefits.

• In North America, the tea market is evolving with a shift towards healthier alternatives, particularly among younger consumers. The U.S. and Canada have seen increasing popularity in iced tea and specialty teas like matcha and herbal blends. There is a growing interest in organic, fair trade, and wellness-focused teas. This shift in preferences is contributing to the diversification of tea offerings, with RTD teas also gaining traction. The market is further fueled by the increasing number of cafes and tea-based beverage establishments. While tea consumption still lags behind coffee in North America, the trend toward health-conscious living continues to drive growth.

• In the Middle East and Africa, tea is a widely consumed beverage, with strong markets in countries like Egypt, Iran, and Morocco. In these regions, tea consumption is deeply tied to cultural and social traditions. Black tea, especially in the form of blends with mint or other herbs, is highly popular. Additionally, the rising popularity of green tea and herbal teas is being noticed due to their perceived health benefits. In Africa, where countries like Kenya are major tea producers, there is a growing demand for both local and international tea brands. The region is seeing steady market growth as more people adopt tea as a beverage of choice.

• In Latin America, the tea market is still emerging compared to other regions. Brazil, Argentina, and Mexico are the key players, with yerba mate being particularly popular in countries like Argentina. The consumption of traditional black and green teas is growing, though the region remains heavily dominated by coffee culture. However, with the increasing health-conscious trend, particularly in urban areas, there is a rising interest in green and herbal teas, particularly among younger populations. The region’s market is expected to continue growing as tea becomes more integrated into local diets.

Competitive Landscape

• R. Twining and Company Limited
• Dilmah Ceylon Tea Company PLC
• Bigelow Tea
• PepsiCo
• YORKSHIRE TEA
• Starbucks Coffee Company
• Unilever
• Caraway Tea
• Harris Freeman
• The Republic of Tea

Recent Developments

• In September 2024, Tata Tea Gold launched a limited-edition series of Kumartuli-themed packs to celebrate the Durga Puja festival. These packs feature five symbolic elements: Dhunuchi dance, Shankho Dhwani, Dhaki, Ashtami Pujarin, and Sindoor Khela. Each pack includes a QR code that activates augmented reality experiences, allowing consumers to bring ceremonial elements into their environment.

• In March 2024, Pansari Group introduced its new green tea range, TVOY GREEN TEA, sourced from the renowned Nilgiris in Tamil Nadu, India. Grown at an altitude of 1900 meters, this eco-friendly product is ISO 9001:2008, HACCP, and Fair Trade certified. TVOY GREEN TEA comes in biodegradable Pyramid Tea Bag Filter Packaging, reflecting the company’s dedication to sustainability. The competitively priced product is available in retail stores and online, catering to the increasing demand for high-quality green tea.

• In March 2024, PepsiCo announced a collaboration with Unilever to launch Pure Leaf Zero Sugar Sweet Tea, a new product designed to meet the rising demand for zero-sugar beverages. This latest addition to the Pure Leaf brand delivers a sweet tea flavor without any added sugars, providing a healthier alternative for consumers mindful of their sugar intake.

Reasons to Acquire

• Increase your understanding of the market for identifying the most suitable strategies and decisions based on sales or revenue fluctuations in terms of volume and value, distribution chain analysis, market trends, and factors.
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