Testing time for China’s tea growers

Testing time for China’s tea growers

By Todd Balazovic and Li Aaoxue (China Daily)    09:06, December 02, 2013Chinese producers take the less traveled road in Africa and Europe forsustained growth, as Todd Balazovic and Li Aoxue report.

What started 5,000 years ago with a haphazard gust of wind dropping foliage into theboiling pot of a wandering Chinese emperor has brewed into a cultural cornerstone worthbillions in any currency.
China may be the world’s largest tea producer — growing about 2 million tons annually —but international demand for leaves from the country best known for its exports is afraction of what it produces, with most of the quality product sold domestically.
Although it accounts for more than 40 percent of the tea produced in the world every year,China exports a tiny fraction of the annual crop yield.
Tea producers from countries such as Kenya, India and Sri Lanka dominate the globalexport market, producing mid- to low-quality teas for mass consumption in the US andEurope.
The reason for China’s small portion of the pot is simple — for Western drinkersunaccustomed to the sophisticated process of fine tea appreciation, the price tag of Chinesetea is too steep.
“There is a culture behind Chinese tea that is not found in the West,” said Li Zongjian,founder of Lijiang-based tea producer Li Liang Xi, at the recent China Tea Expo in Beijing.
Li, who earned his degree studying the ceremony, growing process and health benefits oftea, says much more goes into Chinese tea than simply creating and consuming.
Perched on a bamboo stool before a meticulously carved wooden serving table, Li is eagerto prove his point, theatrically clinking together heated cups as he prepares for a Chinesetea ceremony.
Carefully pinching a dark chunk of Pu’er tea, fermented black tea leaves made famous byChina’s southern Yunnan province, he holds them under his nose, inhaling deeply.
With a look of satisfaction, he begins preparing the leaves in the way most of the Westernworld is familiar — boil water, add tea.
But before the brewing process is complete, Li dumps the entire pot of $150 tea into ahidden drain on his serving table — evoking the obvious question “What was the reason forthat?”
The first boil only works to awaken the tea leaf, he explains.
This takes place two more times before he serves what he has deemed an appropriate cupof tea according to the gongfucha serving method he spent years perfecting.
“When Chinese people drink tea, they don’t consume it like a product. We have tea as apart of our culture, so the standard is high,” Li says, continuing his showmanship with anexaggerated sip from the steaming glass.
“For Westerners, it’s simply a beverage.”
Although it’s hard to put a price on culture, Li can sell 100 grams of his hand-picked teasfor between $100 and $1,500, depending on the age of the leaves and method by whichthey were grown — compared with $28 for the same quantity of popular UK tea brandTwinings.

Unknown's avatarAbout bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

Leave a comment