India’s tea is again a hot brew in Iran

India’s tea exports to Iran look set for a revival. Tea planters in India said they’ve started receiving purchase enquiries from Iran, a development that could potentially reverse the slowdown seen last year in tea shipments to the West Asian nation due to uncertainty over US oil sanctions. 

The US administration late last year decided to exempt India from Iran oil sanctions. Senior tea planters told ET that Iranian buyers have been making trade enquiries and may even buy first flush teas, which enter the market in the April-May period. This could heighten competition with Sri Lanka, which is a major exporter of orthodox teas to Iran. 

“The rupee-rial trade between India and Iran will help Indian tea exporters. In fact, Iranian buyers are very keen to purchase Indian orthodox teas and they may even buy the first flush teas from India,” Vivek Goenka, chairman of Indian Tea Association, told ET. Iran normally buys second flush orthodox tea from India. 

In the backdrop of the US sanctions on Iran, Sri Lanka might find it difficult to trade with the West Asian nation as their business is conducted in dollars. 


Iran consumes about 5 percent of the total world tea production. The nation has its own tea plantations and also imports tea, mainly from India, Sri Lanka, and Kenya. Iranians consume about 1,05,000 tonnes of tea every year, of which about a quarter is supplied by domestic producers. 

Azam Monem, director of tea company Mcleod Russel India, said, “It is expected that the renewed interest of Iran to buy more orthodox teas from India will make the Indian planters shift a portion of their CTC production to orthodox teas.”

India produces 80-100 million kg of orthodox teas every year. Orthodox teas are whole leaf teas manufactured using a traditional process. 

Between January and November last year, India has exported 27.26 million kg of orthodox teas, worth Rs 671.69 crore, to Iran. “We could have easily crossed 30 million kg in 2018 had there been no confusion over the US sanctions on Iran,” said Monem. 

After the US announced its plans of putting an embargo on Iran in July last year, Indian tea exporters, wary of the situation, had halted some of the shipments and some tea producers had switched to CTC from orthodox tea. 

Even though orthodox tea production fell by an estimated 10 percent, prices did not move northward. 

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