UTZ Tea StatisticsReport 2017

More than 107,000 tea

farmers and workers benefitfrom the UTZ program

UTZ certified tea is produced

in 13 countries

In 2017, more than 4.6 billion cups of UTZ certified tea were enjoyed in

48 countries

Introduction

The main goal of this report is to present the scope and scale of the UTZ tea & rooibos program in 2017*. The statistics report is written in order to inform our stakeholders and is part of our commitment to transparency.

The statistics report focuses on the key indicators related to:

• Program reach: UTZ tea & rooibos production, premiums being paid and multi-certification of this production

• Market uptake: sales of UTZ tea & rooibos

This report is part of the UTZ monitoring and evaluation system. Most of the data in this report is collected via our online traceability system, the Good Inside Portal.

We recognize that there may be shortcomings with the reliability of the data. We look forward to receiving your feedback. For more information, please contact the Monitoring & Evaluation Department at ME@utz.org

©2018 UTZInformation presented here is for informative purposes only. UTZ grants permission to use information for personal, non-commercial use, without any right to resell or redistribute information or to compile or create derivative works therefrom.

* Herbal tea is part of the UTZ program but we do not share aggregated data in this report.

SummaryContinuous growth of the UTZ tea program is shown by…

In line with 2016, global UTZ tea sales

grew this year:

Total volume sold increased by 38%

Market uptake continued to grow

Average UTZ cash premium paid to

producers’ groups and estates

increased to 4.75 € cents / kg

… growth of market interest for UTZ tea…

Due to growing market uptake, the

UTZ tea program has been able to

increase its reach:

The program showed further growth

in the number of producing

countries and producers’ groups and

estates

… an expanding reach… ... stabilizing estimated UTZ production…

Supply of UTZ tea has steadily

maintained over the years:

Asia and Africa remained two main

origins of UTZ teas

Production area increased by 14%

The supply-demand ratio increased

to 8%, largely due to increasing

interest in Asian teas.

1. Reach

2. Estimated production

3. Multi-certification

4. First buyer sales

5. Premium

6. Supply-demand trend

1.1 Geographical reachFarmers in 13 different countries across the globe are part of theUTZ Tea Program

Africa Kenya

MalawiMozambique

RwandaSouth AfricaZimbabwe

Latin AmericaArgentina

Asia ChinaIndia

IndonesiaJapan

Sri LankaViet Nam

Drop-out: Colombia (1 estate) New origins: Rwanda and Mozambique

1.2 Program reach UTZ Tea Program continued to expand, in both number of farmers and certified area

An increasing number of farmers due to:• 24% increase in the number of tea estates (from 122 to 151 estates)• 36% increase in the number of producers within a group in the UTZ program

14% growth in certified area A slight decrease in the number of workers in the UTZ program, driven mainly by a decline

in Asia

9,055 8,685

12,775 12,300

16,700

2013 2014 2015 2016 2017

# farmers

32,757 38,605

47,828

67,679

77,298

2013 2014 2015 2016 2017

Area (ha)

52,540 57,479 58,429

104,335

90,695

2013 2014 2015 2016 2017

# permanent and seasonal workers

2.1 Global Estimated UTZ ProductionStabilized production of tea and rooibos compared to 2016

Estimated production is based on license information from licenses valid on December 31st 2017*From 2014 onwards the estimated production volumes are converted to Made tea equivalent** Extension volumes are included

UTZ estimated tea and rooibos production stabilized at 119,883 MT in 2017 Main origins of UTZ supply are Africa and Asia:

• 32% increase in Africa, with new production from Rwanda and Mozambique. • Asia dropped by 18% mainly due to decrease in India, Indonesia, and Sri Lanka.

Latin America estimated tea production decreased by 45%

59,979

71,234

86,294

119,642 119,883

2013 2014 2015 2016 2017

MT

, mad

e te

a eq

uiv

alen

t

50%49%

1%

Origins of production - 2017

Africa Asia Latin America

2.2 Estimated Production per Country India certified volume decreased by 19%, while Kenya increased by 14%

Malawi estimated production increased by 44%. This was linked to an increase in the certified area and a more favorable weather condition in 2017

Less certified tea from Indonesia and Sri Lanka due to a decrease in certified producers

*Others includes: China, Zimbabwe, Rwanda, South Africa, Mozambique, Argentina, Japan, and Viet Nam.

44,285

31,627

16,543

5,638 5,289

16,501

India Kenya Malawi Sri Lanka Indonesia Others*

MT

, mad

e te

a eq

uiv

alen

t

2015

2016

2017

Relative growth ‘16 – ‘17 -19% 14% 44% -15% -31% 43%

2.3 Estimated Production per typeBlack teas continued to account for more than 80% of UTZ tea production (102,092 MT)

The following types of tea were also certified (not reflected in graphs): 225 MT White tea, 74 MT Oolong Tea & 31 MT Pu-er (raw + ripe) Tea

Some origins are highly specialized, for example: China, Japan, and Vietnam for Green tea, South Africa for Rooibos

0%

25%

50%

75%

100%

Share of Sub-products per origin - 2017

3. Multi-certificationNearly 90% of tea producers are multi-certified

*Other includes GlobalGAP, Trustea, HACCP, ISO 22000, Demeter, BRC, GMP, SAGAP

Similar dynamics of multi-certification between 2016 and 2017. Combination with Rainforest Alliance still the most common.

88%

24%

64%

31% 29%

Multi-Certified Fair Trade RFA Organic Other*

2015

2016

2017

4.1 Global sales of UTZ certified teaTotal volume sold by UTZ producers increased by 38%

‘First Buyer Sales’ are all the confirmed sales from the producer to the first buyer. *Volumes include tea and RooibosFrom 2014 onwards the sales volumes are converted to Made tea equivalent

15%

27%

16%

38%

Global share of certified tea from Asia increased from 33% in 2016 to 54% in 2017 and first buyer sales from Asia increased by 126% compared to 2016

Africa remains one of the two main origins of UTZ tea sold (45%) though first buyer sales slightly went down by 4% between 2016 and 2017

3,892

4,527

5,763

6,640

9,171

2013 2014 2015 2016 2017

MT

mad

e te

a eq

uiv

alen

t

45%

54%

1%

Origins of 1st buyer sales - 2017

Africa Asia Latin America

*Others includes: Indonesia, Kenya, Sri Lanka, Argentina, and Rwanda.‘First Buyer Sales’ are all the confirmed sales from the producer to the first buyer. *Volumes include tea and Rooibos

4.2 First buyer sales by country India and China tea sales increased significantly by more than 200% while Malawi and South Africa sales gradually recovered from previous year

India sales grew to become the largest origin

China made it into the top 3 with more green tea sales

Tea sales slightly increased in Malawi and South Africa by 19% and 14%, respectively

3,311

1,989

1,119 1,079

640

1,033

India Malawi China South Africa Zimbabwe Others*

MT

, mad

e te

a eq

uiv

alen

t

2015

2016

2017

Relative growth ‘16 – ‘17 -27%199% 19% 260% 14% -40%

‘First Buyer Sales’ are sales from the producer to the first buyer. *Volumes include tea and Rooibos

4.3 Sales by productBlack teas continued to dominate UTZ tea first buyer sales while share of green tea increased by 5%

Black teas continued to account for more than 60% of UTZ tea sales (5,422 MT). Sale of Black tea types slightly changed compared to 2016 with 6% increase in share of Orthodox

Sales of Rooibos in 2017 was 1,079 MT and accounted for 12% of total sales

3,411

2,644

2,011

1,079

24

CTC/STP BlackTea

Green Tea Orthodox BlackTea

Rooibos White Tea

MT

, mad

e te

a eq

uiv

alen

t

44% 46%37%

20% 24%29%

17%16% 22%

18% 14% 12%

2015 2016 2017

Share of sub-products in total sales

44

53

90 82

106

2013 2014 2015 2016 2017

Number of licensed Supply Chain Actors*

4.4 Market uptakeInterest in the program continued to grow steadily

29%

Number of licensed Supply Chain Actors increased by 29% 53% of the licensed Supply Chain Actors are based in Europe, followed by Asia (34%). In 2017, there were 476 new UTZ labelled SKUs* launched on the market.

* Including also herbal tea

5. Premium Average premium paid to producers experienced a large increase to 4.75 € cents /kg

The UTZ Premium is an additional cash amount paid above the market price for a similar conventional product. It is mandatory and agreed upon between the certified group or producer and the first buyer

Premium of 4.75 € cents /kg of tea was paid on average to producers - one of the two highest premiums over the last 5 years

The premium paid to producers differs highly within and between origin countries

UTZ premium calculations are based on transaction data recorded in the UTZ traceability system

4.81 4.66 4.594.32

4.75

2013 2014 2015 2016 2017

Average premium (cent/kg)

6. Supply-demand trends8% of estimated production was bought by supply chain actors as UTZ

Supply-demand ratio is based on first buyers sales and estimated production The supply-demand ratio for Asia increased to 8% due to a large increase in demand for

Chinese and Indian tea 7% of tea in Africa was sold as UTZ, down from 10% in 2016 due to a large increase in supply

in both South Africa and Malawi The ratio for Latin America stayed almost the same, down by 1% compared to 2016

7%6%

7%

6%

8%

2013 2014 2015 2016 2017

% of estimated production sold as UTZ