Producers welcome proposal for minimum sustainable price for tea

Observing that a committee of Tea Board of India has recommended a proposal to implement minimum sustainable price for tea, several stakeholders of the tea industry on Tuesday (November 10, 2026) welcomed the proposal and said that such an initiative will help in increasing wages of tea garden workers and is essential for long term sustainability of the industry.

Representatives of different associations associated with the industry expressed apprehensions that with implementation of the Code on Wages, there will be a further increase in wage costs, and the financial viability of tea producers is likely to face additional challenges

“The tea industry is confronted with mounting cost pressures, while tea price realisations have remained relatively stagnant. A Minimum Sustainable Price framework is therefore essential to bridge the widening gap between production costs and market realisations and to ensure the long-term sustainability of the industry,” said C. K Dhanuka, Chairman, Dhunseri Tea and Industries. Mr. Dhanuka added that a minimum sustainable price will help bring realisations in line with costs, so that the industry can accommodate wage revisions, protect employment and the competitiveness of Indian tea.

The proposal of implementing minimum sustainable price for tea have been made to Ministry of Commerce, which is yet to take a decision on the proposal, the stakeholders of tea industry said.

Suneel Singh Sikand, chairman of Indian Tea Association (ITA) called the recommendation for a minimum sustainable price is an important policy intervention towards addressing the structural challenges confronting the Indian tea industry.

“Ensuring remunerative returns to producers is critical to sustaining operations, facilitating investment in re-plantation and productivity enhancement and securing the industry’s long-term sustainability,” Mr. Sikand said.

Hemanta Bangur, former president of ITA said that the industry has failed to uplift the workforce and something is fundamentally wrong with the industry as the balance sheet of most of the tea growers is in the red.

“The market is dysfunctional and there is no level playing field. If market forces are left to determine the fate of industry, it will bring about the demise of tea gardens,” he said.

The Tea Industry employs millions of workers in about 270 large tea gardens and hundreds of small tea gardens across the State. The daily wage for a tea garden worker in West Bengal is ₹250 per day.

Representatives of Indian Tea Association (ITA), Tea Association of India (TAI), United Planters’ Association of Southern India (UPASI), Confederation of Indian Small Tea Growers Associations (CISTA) and Federation of Indian Tea Manufacturers Association (FITMA) issued a press statement on the stagnation in the prices over the past several years

“Over the years, tea prices have registered a marginal compound annual growth rate (CAGR) of approximately 2–3%, as compared to an estimated CAGR of 10–14% in input costs. This growing disparity has affected producers’ ability to sustain operations, invest in re-plantation, improve productivity and maintain quality standards,” the press statement said.

Without divulging any details of the minimum sustainable price, the tea growers said that the proposed price band will cover only the cost of production.

“The proposed MSP framework also needs to account for the diverse economic realities of India’s tea-growing regions. Differences in agro-climatic conditions, production practices, productivity levels and operating costs influence the economics of tea cultivation across regions,” the press statement said.

The producers, however, did not specify what will be the impact of the minimum sustainable price on the price of tea in the retail market and on the consumers.

Published - November 11, 2026 04:32 am IST