Whether a steaming hot cup of tea on a cold winter’s night or a cold glass of iced tea on a hot summer’s afternoon, however people choose to enjoy this beverage a great many are doing just that. Worldwide tea consumption, 35.2 liters per capita in 2017, is second only to packaged water consumption. In 2018, revenues totaled $52.1 billion.
Today’s market size shows worldwide revenues for one type of tea, fruit tea, for 2019 and projected for 2027. Fruit flavored tea sales are a small fraction of overall tea sales and will continue to be in the near future; however, sales are expected to increase at a compound annual growth rate (CAGR) of 9.6% through 2027. Overall tea sales are expected to rise at a CAGR of 5.8% over most of this time period.
Growth in the fruit tea market is expected to be driven by a growing consumer preference for low caffeine beverages and fruit-infused products, especially among millennials and the health-conscious. As with other segments of the food and beverage industry that are seeing a rise in organic product sales, organic teas are gaining in popularity but they are still a small segment of the market. In 2019, conventional teas claimed more than 80% of sales. Easy accessibility and affordability are factors in conventional fruit teas maintaining their high market share.
Most people buy their tea offline. A majority of sales take place at supermarkets and discount stores. Specialty retailers and teahouses are gaining in popularity among consumers who want premium teas with unique flavors. While online sales have a small share of the market, they are expected to have the fastest growth through 2027, with a CAGR of 10.6%.
The Asia-Pacific region claimed more than 35% of the global market in 2019. China is the largest producer and consumer of fruit tea. Demand for fruit and floral-infused beverages has seen significant growth in that country in recent years. North America is expected to experience the fastest growth, a CAGR of 10.5%, from 2020 to 2027 due to shifting consumer preferences for healthier fruit-flavored beverages. The increasing popularity of ready-to-drink beverages is also expected to contribute to this growth. Leading global fruit tea manufacturers include Harney & Sons Fine Teas, R. Twining and Company Ltd., Tata Consumer Products, Hain Celestial, Unilever, The Bigelow Tea Co., Dilmah Ceylon Tea Co. PLC, Tiesta Tea, and Bettys & Taylors of Harrogate Ltd.
Geographic reference: World
Year: 2019 and 2027
Market size: $2.4 billion and $5.1 billion, respectively
Sources: “Fruit Tea Market Size, Share & Trends Analysis Report by Product (Conventional, Organic), by Distribution Channel (Offline, Online), by Region (North America, Europe, APAC, CSA, MEA), and Segment Forecasts, 2020 – 2027,” Grand View Research Report Summary, March 2020 available online here; “Fruit Tea Market Size Worth $5.1 Billion by 2027 | CAGR: 9.6%: Grand View Research, Inc.,” CISION PR Newswire, April 23, 2020 available online here; “Tea Market by Type (Green Tea, Black Tea, Oolong Tea, Fruit/Herbal Tea, and Others), Packaging (Plastic Containers, Loose Tea, Paperboards, Aluminum Tins, and Tea Bags), Distribution Channel (Supermarkets/Hypermarkets, Specialty Stores, Convenience Stores, Online Stores, and Others) and Application (Residential and Commercial): Global Opportunity Analysis and Industry Forecast, 2019-2026,” Allied Market Research Report Overview, December 2019 available online here; Dan Bolton, “Tea Consumption Second Only to Packaged Water,” Worldtea News, May 1, 2018 available online here; “Tea Quotes,” Goodreads available online here.
Image source: TerriC, “tea-cup-vintage-tea-cup-tea-cup-2107599,” Pixabay, March 1, 2017 available online here.