Record tea export gains at risk as West Asia crisis chokes shipping routes
Disruptions in Strait of Hormuz, soaring freight costs threaten to derail exports, leaving premium orthodox tea growers in Assam and Bengal bracing for a slump
Just months after securing a historic milestone—exporting a record-breaking 280.40 million kg of tea in 2025—India’s tea sector is losing steam as the escalating crisis in West Asia takes a heavy toll.
With critical trade corridors like the Strait of Hormuz severely disrupted and communication blackouts stalling contracts with major buyers in Iran, the current slowdown has become a cause for concern in tea-growing regions like Assam and West Bengal.
The geopolitical gridlock threatens to rapidly erase last year’s competitive gains, leaving Indian exporters facing delayed shipments, soaring freight costs, and evaporating demand from one of their most lucrative premium markets.
It's estimated that exports for the full year could fall at least 20 per cent. In the January-March 2026 quarter, India exported 21.01 million kg less tea during the quarter, a 17 per cent decline year-on-year.
Drop in volume
According to 2024 figures for the January–December period, nearly 40 per cent of India’s total tea exports were shipped to four West Asian countries — the UAE, Iran, Saudi Arabia and Iraq.
Cape of Good Hope detour
Weakened demand
Bihani added that economic uncertainty in West Asian countries has weakened demand, especially in the bulk and mid-grade tea segment. “Rising fuel prices are affecting consumption patterns both in domestic and overseas markets. Commercial demand is under pressure,” he said.
Further, industry sources told The Federal that auction centres have started witnessing pressure from unsold stocks as overseas buyers slow down purchases.
Serious impact
West Asian countries together imported 122.49 million kg of Indian tea during 2025, accounting for nearly half of the country’s total tea exports. Unlike CTC (crush, tear, curl) tea, orthodox tea relies far more on overseas buyers and has a relatively limited domestic market. Industry observers say any prolonged disruption in West Asia could directly impact auction prices and export volumes.
Also read | Your tea or mine? Why Nepal tea is ‘stronger’ than Darjeeling tea
The concern is particularly serious for Assam’s tea economy, which supports lakhs of workers and thousands of small tea growers across the state and North Bengal. With the 2026 plucking season already underway, exporters fear a prolonged crisis could completely stall the momentum built last year.
The underlying vulnerabilities of relying too heavily on specific nations are also becoming apparent. Replying to a parliamentary question from TMC MP Sushmita Dev on February 6, Union Minister of State for Commerce and Industry Jitin Prasada admitted that India’s tea exports to Iran specifically had already been on a downward trend, declining from 36 million kg in 2020 to 13.38 million kg in 2025 (collected till November). The current shipping crisis threatens to bottleneck what remains of this trade.
Push for diversification
NETA adviser Barkakoty noted that the fallout is already hitting ground operations. “There could be a major impact on tea exports to West Asia because of shipment delays. Exports to the Middle East have slowed considerably due to concerns surrounding the Strait of Hormuz. In some cases, consignments are getting delayed by more than 40 days,” he said.
In response, tea industry bodies, including the Tea Association of India, have urgently stressed the need to diversify export destinations. Stakeholders are also seeking the continuation of government incentives for orthodox tea production—particularly in Assam, where premium teas remain at the mercy of volatile overseas markets.
Although exporters see future opportunities in countries such as China, Russia, and the United States, they warn that replacing long-established Gulf markets will not be easy, as tea trade networks and regional consumer preferences have evolved over decades.
