Spring tea estimated to drop in pricing

After the first batch of tea leaves being processed, the tea made of them turned to red. “This batch of tea is basically wasted. No one will buy them. We can only consume it ourselves or sell it at a lower price.” Says Zhu. In the previous year, the first batch of Longjing tea would sell at the price of two to three thousand yuan per kilogram, some of which even higher.

Beside Longjing tea, the spring tea in other areas of Zhejiang Province have also suffered damage from the cold weather. According to the experts from the Provincial Agricultural Bureau, till the end of March, the total loss of spring tea has exceeded 30%.

“The price is decided by supply and demand, the increased price caused by reduced supply of Longjing tea is hard to avoid in the following period.” Says Luo Wanke, the chief and research at Provincial Agricultural Planting Administration Bureau at the Tea Department. Recent days, the price of the spring teas have shown signs of the rebound.

Zhu Mingquan estimates if the weather is good, around 20th this month, their tea garden can start harvesting. “As long as the weather is getting warm, whether it rains or not doesn’t matter much.” Says Zhu.

“What we estimated is that including the Xihu Longjing Tea, most of the large scaled harvesting will start after ten days.” Says Luo Liewan.

So, what the price will look like for Longjing tea? As the reduction in supply due to cold weather, will this year’s price higher than last year in general?

“Once the large scaled harvesting starts, the price of tea will fall.” Says Luo Liewan.

However, for tea farmers, they should not have high expectation on the tea price.

Before the arriving of the cold weather, Hangzhou Zhenghao Tea Co., Ltd. proposed 350 yuan per kilogram for raw tea, which has caused the large reaction among farmers. “Last year, the purchasing price was still 500 yuan per kilogram, this year is only 350 yuan. The price has dropped too sharply.” Some farmers complain.

Hangzhou Zhenghao Tea Co., Ltd has its own reason for this. “The tea leaves we purchased are wet tea, which means the tea leaves have rain on them. We need 5 kilograms raw tea to make 1 gram of Longjing tea. The cost per kilogram is approximately 2000 yuan. We purchased total 1,000 kilograms.”

“Looking from the whole province, the price reduction is common earlier this year. Except for the earliest spring tea in the market has kept the similar price as last year, the rest of the spring tea’s price has dropped more than 5% compare to last year. Some even reduced 10%.” Says Luo Liewan.

In an analysis of price reduction in spring tea, Luo thinks there are two main reasons: firstly, the current economic environment is not very optimistic, which will affect the consumption of tea. There are many tea distributors waiting and delaying the time window for purchasing. Some reduced the quantity of purchasing. Secondly, the domestic production amount is continuous increasing, causing increased supply. “The tea garden in Zhejiang has not increased much, only 3% increase last year, production increased 10%. But the entire domestic tea plantation area increased by hundreds of acres every year. The production capacity is still increasing.” This means every year; there is a total size of the tea garden in Zhejiang added.

In fact, since last year, the tea distribution business has suffered relatively large affects, the profit decreased largely. The second half of last year, some tea farm, and local distribution has start shown inventory. Zhejiang Tea sales last year have kept the overall balance. However, facing the new market situation, no matter if you are distributor or farmers, you should adjust your attitude to the market, especially the Xihu Longjing Tea, and you should not have the mindset because the high demand tea, you don’t need to worry about the sales.

As the first of top 10 green tea – Xihu Longjing, the most precious is definitely the first batch of tea of Mingqian. However, the cold in the late spring last week has made Longjing tea suffer severe sickness. “Firstly is the cold snow, then is the frost, burned by the sun, many of the bud were burnt out.” Zhu Mingquan says sadly.