Tea in Australia

Euromonitor International
March 2019
TEA IN AUSTRALIA Passport I

LIST OF CONTENTS AND TABLES

Headlines ..................................................................................................................................... 1
Prospects ..................................................................................................................................... 1
Lack of Innovation Impacting Traditional Teas ......................................................................... 1
Health Advantages of Tea and Novel Flavours To Draw in Consumers ................................... 1
On-trade Sales Encouraged by Widening Product Variety ....................................................... 1
Competitive Landscape ................................................................................................................ 1
Unilever Australia Ltd Leads Tea in Australia ........................................................................... 2
Ab Food & Beverages Australia Continues To Gain Share in Tea ........................................... 2
Madura Tea Estates Australia Sees Growth Over the Review Period, However This Stagnates
in 2018 ...................................................................................................................................... 2
Category Data .............................................................................................................................. 2
Table 1 Retail Sales of Tea by Category: Volume 2013-2018................................... 2
Table 2 Retail Sales of Tea by Category: Value 2013-2018 ..................................... 2
Table 3 Retail Sales of Tea by Category: % Volume Growth 2013-2018 .................. 3
Table 4 Retail Sales of Tea by Category: % Value Growth 2013-2018 ..................... 3
Table 5 NBO Company Shares of Tea: % Retail Value 2014-2018 .......................... 3
Table 6 LBN Brand Shares of Tea: % Retail Value 2015-2018 ................................. 4
Table 7 Forecast Retail Sales of Tea by Category: Volume 2018-2023.................... 5
Table 8 Forecast Retail Sales of Tea by Category: Value 2018-2023....................... 5
Table 9 Forecast Retail Sales of Tea by Category: % Volume Growth 2018-
2023 ............................................................................................................. 5
Table 10 Forecast Retail Sales of Tea by Category: % Value Growth 2018-
2023 ............................................................................................................. 6

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TEA IN AUSTRALIA
HEADLINES
 Tea declines by 1% in off-trade volume while growing by 3% in off-trade current value to
reach AUD429 million in 2018
 Other fruit/herbal tea records the strongest off-trade value growth in tea, spurred by its health
positioning
 On-trade volume sales of tea increase by 3% while off-trade volume sales decline by 1% in
2018
 Unilever Australia leads tea in Australia with a 26% off-trade value share in 2018
 Tea to record a -1% off-trade volume CAGR and 5% off-trade current value CAGR (3%
CAGR at constant 2018 prices) over the forecast period to reach AUD548 million in 2023

PROSPECTS

Lack of Innovation Impacting Traditional Teas

A shortage of new product innovation is impacting sales of traditional teas, such as black tea,
as it is not drawing fresh consumers to these products. This trend is observed in the falling per
capita consumption of black tea, which decreased each year over the review period and is
predicted to remain in decline over the forecast period. The growth of coffee culture in Australia
could also be a factor contributing to the decline of traditional tea as Australians seek out a
morning cup of coffee rather than tea.

Health Advantages of Tea and Novel Flavours To Draw in Consumers

On the other hand, teas with a health positioning, such as other fruit/herbal tea, saw
significant growth in 2018. Consumers are attracted to the health positioning and benefits of
these products. Trade press “Retail World” quoted Endeavour Consumer Health Senior Brand
Manager, Ms Tyquin, in May 2018 as noting that change within tea will be motivated by the
health advantages of the products as well as consumers wanting more flavour novelty and
variety. Ms Tyquin is also quoted in this article as stating, "Consumers are looking for healthier
alternatives in every category," and that "herbal tea certainly answers this". As a result, other
fruit/herbal tea is expected to record the strongest value growth in tea over the forecast period.

On-trade Sales Encouraged by Widening Product Variety

On-trade volume sales of tea recorded reasonable growth in 2018. This is attributable to the
increasing variety of speciality teas, such as Chai, and herbal teas, such as peppermint,
attracting more consumers to drink tea in the on-trade by providing greater product choice. This
growth is also being supported by the café culture of Australia, with tea products appealing to
those visiting cafés who are looking for a beverage other than coffee.

COMPETITIVE LANDSCAPE

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Unilever Australia Ltd Leads Tea in Australia

While Unilever Australia led tea in Australia in 2018, the company recorded year-on-year
declines in share over the review period. The biggest competition for the company within tea
comes from AB Food & Beverages Australia, which recorded year-on-year share growth in tea
over the review period. Within loose black tea, Bushells was the leading brand, comprising of
three variants, with the Bushells Blue Label Fine Leaf Tea the leading subbrand. All three
subbrands experienced year-on-year declines throughout the review period. Within tea bags
black, Lipton Yellow Label was the number two brand, although the brand’s share has declined
since the start of the review period, coinciding with the growth of the Twinings brand.
Conversely, within green tea, the Lipton brand leads, with the brand’s share increasing
throughout the review period. The company launched a matcha green tea range in three
variants in November 2017: Green Tea with Pure Matcha; Green Tea with Pure Matcha Ginger;
and Green Tea with Pure Matcha Mint.

Ab Food & Beverages Australia Continues To Gain Share in Tea

AB Food & Beverages Australia took over the lead in black tea in 2017, which it continued to
hold in 2018. The Twinings brand recorded a slight brand share increase in loose black tea,
while the brand recorded slight decline in its tea bags black share in 2018. The company’s
Twinings brand also leads in fruit/herbal tea, a position that has been consistent throughout the
review period. The company’s Twinings Green Tea ranked second within green tea in 2018 and
the brand increased its share within green tea over the review period.

Madura Tea Estates Australia Sees Growth Over the Review Period,
However This Stagnates in 2018
Madura Tea Estates Australia Pty Ltd is a locally managed and owned tea company located
in northern New South Wales. The company recorded year-on-year increases within black tea
between 2013 and 2017; however, this growth was negligible in 2018. In contrast, the
company’s share within green tea increased between 2016 and 2018. Madura Green Tea is the
fifth-ranked brand within green tea in Australia in 2018.

CATEGORY DATA
Table 1 Retail Sales of Tea by Category: Volume 2013-2018

Tonnes
2013 2014 2015 2016 2017 2018

Black Tea 10,893.2 10,679.2 10,440.7 10,181.9 9,980.1 9,824.6

- Loose Black Tea 2,548.3 2,463.0 2,392.8 2,319.2 2,258.9 2,211.4
- Tea Bags Black 8,345.0 8,216.2 8,047.9 7,862.8 7,721.2 7,613.1
Fruit/Herbal Tea 870.1 926.4 985.1 1,049.8 1,121.2 1,196.3
Green Tea 817.2 876.9 939.1 967.3 1,007.0 1,045.2
Instant Tea 629.8 547.9 475.1 421.6 388.7 360.0
Other Tea 51.6 52.2 52.7 53.0 53.5 54.1
Tea 13,261.9 13,082.6 12,892.6 12,673.6 12,550.4 12,480.1
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
store checks, trade interviews, trade sources

Table 2 Retail Sales of Tea by Category: Value 2013-2018

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AUD million
2013 2014 2015 2016 2017 2018

Black Tea 261.3 262.6 260.4 259.1 262.7 268.1

- Loose Black Tea 41.0 40.6 39.9 39.4 39.9 40.6
- Tea Bags Black 220.3 222.1 220.5 219.7 222.8 227.5
Fruit/Herbal Tea 62.1 66.0 69.3 74.0 79.1 85.4
Green Tea 46.9 50.8 54.1 55.9 57.8 59.7
Instant Tea 22.8 19.8 16.7 14.9 13.8 12.8
Other Tea 3.1 3.2 3.3 3.3 3.4 3.5
Tea 396.3 402.3 403.7 407.1 416.8 429.4
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
store checks, trade interviews, trade sources

Table 3 Retail Sales of Tea by Category: % Volume Growth 2013-2018

% volume growth
2017/18 2013-18 CAGR 2013/18 Total

Black Tea -1.6 -2.0 -9.8

- Loose Black Tea -2.1 -2.8 -13.2
- Tea Bags Black -1.4 -1.8 -8.8
Fruit/Herbal Tea 6.7 6.6 37.5
Green Tea 3.8 5.0 27.9
Instant Tea -7.4 -10.6 -42.8
Other Tea 1.1 0.9 4.7
Tea -0.6 -1.2 -5.9
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
store checks, trade interviews, trade sources

Table 4 Retail Sales of Tea by Category: % Value Growth 2013-2018

% current value growth

2017/18 2013-18 CAGR 2013/18 Total

Black Tea 2.0 0.5 2.6

- Loose Black Tea 1.7 -0.2 -1.0
- Tea Bags Black 2.1 0.6 3.2
Fruit/Herbal Tea 7.9 6.6 37.4
Green Tea 3.2 4.9 27.3
Instant Tea -7.1 -11.0 -44.0
Other Tea 3.5 2.3 11.9
Tea 3.0 1.6 8.4
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
store checks, trade interviews, trade sources

Table 5 NBO Company Shares of Tea: % Retail Value 2014-2018

% retail value rsp

Company 2014 2015 2016 2017 2018

Unilever Australia Ltd 28.3 27.5 26.9 26.0 25.8

AB Food & Beverages 22.4 23.0 23.9 24.6 24.7
Australia Pty Ltd

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Dilmah Australia Pty Ltd 11.2 11.0 10.8 10.3 10.3

Tetley Australia Pty Ltd 10.3 10.2 9.8 9.4 9.3
Madura Tea Estates 4.4 4.5 4.7 4.8 4.8
Australia Pty Ltd
Nerada Tea Pty Ltd 3.6 3.4 3.3 3.2 3.2
Aldi Stores 1.4 1.4 1.5 1.6 1.6
Supermarkets Pty Ltd
Cantarella Bros Pty Ltd 0.4 0.4 0.4 0.4 0.4
United Foods Pty Ltd 0.2 0.2 0.2 0.2 0.2
Red Seal Natural Health 0.1 0.1 0.1 0.1 0.2
Ltd
Just Rooibos Australia 0.1 0.1 0.1 0.1 0.1
Other Private Label 2.0 2.1 2.1 2.0 2.1
Others 15.6 16.1 16.2 17.2 17.4
Total 100.0 100.0 100.0 100.0 100.0
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
store checks, trade interviews, trade sources

Table 6 LBN Brand Shares of Tea: % Retail Value 2015-2018

% retail value rsp

Brand (GBO) Company (NBO) 2015 2016 2017 2018

Twinings AB Food & Beverages 23.0 23.9 24.6 24.7

(Associated British Australia Pty Ltd
Foods Plc)
Lipton (Unilever Unilever Australia Ltd 12.0 12.2 12.1 12.1
Group)
Dilmah (MJF Group) Dilmah Australia Pty Ltd 11.0 10.8 10.3 10.3
Lipton Yellow Label Unilever Australia Ltd 9.3 8.8 8.2 8.2
(Unilever Group)
Tetley (Tata Global Tetley Australia Pty Ltd 8.4 8.2 8.0 7.9
Beverages Ltd)
Bushells (Unilever Unilever Australia Ltd 5.7 5.5 5.2 5.1
Group)
Madura Madura Tea Estates 4.5 4.7 4.8 4.8
Australia Pty Ltd
Nerada (Boh Nerada Tea Pty Ltd 3.4 3.3 3.2 3.2
Plantations Sdn Bhd)
Diplomat (Private Aldi Stores 1.1 1.2 1.3 1.3
Label) Supermarkets Pty Ltd
Tynee Tips (Tata Tetley Australia Pty Ltd 0.8 0.6 0.5 0.5
Global Beverages Ltd)
Natureland Cantarella Bros Pty Ltd 0.4 0.4 0.4 0.4
Just Organic Aldi Stores 0.3 0.3 0.4 0.4
(Private Label) Supermarkets Pty Ltd
Robur (Tata Global Tetley Australia Pty Ltd 0.3 0.3 0.2 0.2
Beverages Ltd)
Celestial United Foods Pty Ltd 0.2 0.2 0.2 0.2
Seasonings (Hain
Celestial Group
Inc, The)
Red Seal (Ebos Red Seal Natural Health - 0.1 0.1 0.2
Group Ltd) Ltd
Just Rooibos (Just Just Rooibos Australia 0.1 0.1 0.1 0.1
Rooibos CC)
Kinkara (Tata Tetley Australia Pty Ltd 0.1 0.1 0.1 0.1
Global Beverages Ltd)
Red Seal Red Seal Natural Health 0.1 - - -

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Ltd
Jarrah (Associated AB Food & Beverages - - - -
British Foods Plc) Australia Pty Ltd
Kinkara (Tata Tea Tetley Australia Pty Ltd - - - -
Ltd)
Robur (Tata Tea Ltd) Tetley Australia Pty Ltd - - - -
Tetley (Tata Tea Ltd) Tetley Australia Pty Ltd - - - -
Tynee Tips (Tata Tetley Australia Pty Ltd - - - -
Tea Ltd)
Other Private Label Other Private Label 2.1 2.1 2.0 2.1
(Private Label)
Others Others 17.3 17.4 18.3 18.4
Total Total 100.0 100.0 100.0 100.0
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
store checks, trade interviews, trade sources

Table 7 Forecast Retail Sales of Tea by Category: Volume 2018-2023

Tonnes
2018 2019 2020 2021 2022 2023

Black Tea 9,824.6 9,602.1 9,410.4 9,235.5 9,080.5 8,945.1

- Loose Black Tea 2,211.4 2,144.2 2,081.9 2,023.0 1,970.6 1,924.3
- Tea Bags Black 7,613.1 7,457.8 7,328.5 7,212.4 7,109.9 7,020.9
Fruit/Herbal Tea 1,196.3 1,275.3 1,355.7 1,438.3 1,523.4 1,614.7
Green Tea 1,045.2 1,090.9 1,133.7 1,173.2 1,209.2 1,242.0
Instant Tea 360.0 334.1 314.4 298.6 284.6 271.5
Other Tea 54.1 54.8 55.6 56.7 57.7 58.9
Tea 12,480.1 12,357.1 12,269.9 12,202.3 12,155.5 12,132.2
Source: Euromonitor International from trade associations, trade press, company research, trade interviews,
trade sources

Table 8 Forecast Retail Sales of Tea by Category: Value 2018-2023

AUD million
2018 2019 2020 2021 2022 2023

Black Tea 268.1 270.6 274.1 276.7 279.2 282.9

- Loose Black Tea 40.6 40.2 40.0 39.8 39.7 39.8
- Tea Bags Black 227.5 230.4 234.1 236.9 239.5 243.1
Fruit/Herbal Tea 85.4 91.8 97.6 103.6 109.8 116.5
Green Tea 59.7 61.7 64.3 66.9 69.4 71.8
Instant Tea 12.8 11.9 11.3 10.8 10.3 9.9
Other Tea 3.5 3.6 3.7 3.8 3.9 4.0
Tea 429.4 439.7 451.0 461.8 472.7 485.2
Source: Euromonitor International from trade associations, trade press, company research, trade interviews,
trade sources

Table 9 Forecast Retail Sales of Tea by Category: % Volume Growth 2018-2023

% volume growth
2018/19 2018-23 CAGR 2018/23 Total

Black Tea -2.3 -1.9 -9.0

- Loose Black Tea -3.0 -2.7 -13.0

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- Tea Bags Black -2.0 -1.6 -7.8

Fruit/Herbal Tea 6.6 6.2 35.0
Green Tea 4.4 3.5 18.8
Instant Tea -7.2 -5.5 -24.6
Other Tea 1.3 1.7 8.9
Tea -1.0 -0.6 -2.8
Source: Euromonitor International from trade associations, trade press, company research, trade interviews,
trade sources

Table 10 Forecast Retail Sales of Tea by Category: % Value Growth 2018-2023

% constant value growth

2018/2019 2018-23 CAGR 2018/23 Total

Black Tea 1.0 1.1 5.5

- Loose Black Tea -0.9 -0.4 -2.1
- Tea Bags Black 1.3 1.3 6.9
Fruit/Herbal Tea 7.5 6.4 36.5
Green Tea 3.4 3.8 20.3
Instant Tea -6.8 -5.0 -22.5
Other Tea 2.7 2.9 15.5
Tea 2.4 2.5 13.0
Source: Euromonitor International from trade associations, trade press, company research, trade interviews,
trade sources

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