A Nation of Tea Drinkers

Not all large quantity tea-producing countries are also large exporters. In 2015, the 5 largest exporters worldwide were China, Sri Lanka, India, Vietnam and Argentina and most of the tea in the U.S. was imported from Argentina, China, India and Vietnam.

In 2016, the U.S. was the third largest importer of tea in the world, after Russia and Pakistan, according to the ITC (International Tea Committee). It is the only western country to grow in both tea imports and consumption.

U.S. tea imports have grown by roughly 40% over the past 10 years, nearly 70% over the past 20 years, and more than 700% over the last 50 years, according to data from the U.S. Department of Agriculture.

According to the Tea Association of the USA, the total wholesale value of tea sold in the U.S. grew from around $1.8 billion in 1990 to $12 billion in 2016.

One of the prime reasons for tea’s growing popularity in the U.S. is its perceived health benefits, both in terms of the chemical makeup of the tea itself, but also as an alternative to high-calorie and sugary beverages like soda.

This is evident when looking at the U.S. Liquid Refreshment Beverage Market and comparing the % change in volume by segment over the past several years.

Companies like Starbucks and Dunkin’ Donuts have been working to expand their offerings in the tea category. Major beverage companies like PepsiCo, Coca-Cola and Dr Pepper Snapple, with their respective tea brands, continue to bring innovative products and flavors to the industry.

America’s favorite kind of tea is black tea, which accounts for more than half of all tea consumed in the country, according to market research by Euromonitor. Fruit and herbal tisanes account for 25%, and green tea has grown in recent years to around 11%. Specialty and artisinal teas like rooibos, oolong, and white teas are slowly gaining in popularity and account for roughly 7% of U.S. tea consumption.

The increased availability and options for bottled (ready-to-drink/RTD) teas makes tea-drinking more convenient. As a result, the value of the RTD category of the tea market is growing rapidly.

Given this data, it’s not surprising that 85% of the tea consumed in the U.S. is iced.

In 1946 the average American drank nearly 46 gallons of coffee a year, compared to only 23 gallons in 2013. A recent survey by YouGov.com suggests that this dwindling consumption may be due to a generational shift.

The research indicates that the younger you are, the more likely you are to prefer tea to coffee. When people under 30 were asked whether they prefer coffee or tea, they responded equally, but a larger percentage of them actually drink some tea (66%) compared to those that drink some coffee (57%).

Somewhat less surprisingly, the data also indicates that women are more likely, and prefer, to drink tea than men.

With tea’s popularity among millennials continuing, and the strong upward trends of the U.S. tea market, it seems highly likely that the dominance of coffee in the U.S. will continue to wane over time.