Expert: Most tea-related companies are owned by the same person

Over the past year, the cost of essential food products in Azerbaijan has been on the rise, with beef, mutton, and tea taking the lead. According to data from the State Statistics Committee (SSC), the price of beef has surged by 19-20 percent since August 2022. Following closely behind is tea, which has seen a 15 percent increase in price during the same period.

Tea, a beloved beverage in Azerbaijan, has a significant presence in the country, with approximately 1,630 hectares of tea plantations, predominantly located in the Lankaran, Astara, and Masalli districts.

However, concerning news emerges when examining tea production in the first seven months of 2023. The SSC reports a 10 percent decrease in tea production compared to the same period last year, raising concerns about the availability of this popular beverage in the local market.

Azerbaijan's tea industry is also facing problems on the international market. According to the State Customs Committee, tea exports in the first seven months of 2023 amounted to only 379 tons worth 3.4 million.. dollars. This is in sharp contrast to the same period last year, when the country exported 1.26 thousand tons worth $ 7.6 million. In fact, exports decreased 2.2 times in value terms and 3.3 times in physical terms compared to 2022.

As for the import sector, during the same period of 2023, Azerbaijan imported 7.2 thousand tons of tea worth $ 82.2 million. This represents a significant decrease compared to 2022, with a reduction in import costs by $4.1 million and a decrease in tea production by 14.3 percent.

The Ministry of Agriculture, however, provides a more optimistic outlook, citing progress in tea plantation expansion and productivity under the state program for the development of tea growing in Azerbaijan from 2018 to 2027. The Ministry states that the yield per hectare has increased to over 16 quintals, and they aim to expand the arable land for tea to 3,000 hectares and green tea leaf harvesting to 8.5 thousand tons by 2027.

Despite these initiatives, experts like Vahid Maharramli, who specializes in agriculture, believe that Azerbaijan is still far from meeting its domestic demand for tea, which hovers around 20,000 tons annually. He points out that imports play a significant role in determining tea prices in the country, given the limited local production. Furthermore, Maharramli suggests that those involved in tea imports may not have an incentive to increase supply, as higher prices can lead to increased profits.

Maharramli emphasizes the importance of supporting local farmers to boost tea production. Access to essential resources like water and financial support can greatly improve the quality and quantity of tea produced in Azerbaijan. He also raises concerns about the concentration of the tea processing and sale industry in the hands of a few entities, potentially leading to price manipulation.

In conclusion, while Azerbaijan has ambitions to bolster its tea industry through state programs and initiatives, challenges such as fluctuations in production, exports, and potential price manipulation continue to impact the tea market in the country. Addressing these issues will be crucial to ensure the stability and affordability of this cherished beverage for Azerbaijani consumers.