PRELIMINARY ANALYSIS OF THE IMPACT OF HIGH TEA PRICES ON THE WORLD TEA ECONOMY

摘要

The holding of the 18th Session of the Intergovernmental Group on Tea in May 2008 coincided with the unprecedented rise in food prices, which led to the Group requesting the Secretariat to conduct a study to assess the impact of high food prices on the world tea economy. However, preliminary findings of the Secretariat indicated a limited impact of high food prices on tea. On the supply side, there was little or no reversion from tea to basic food crops in response to the rise in food prices, and, onthe demand side, there was little or no substitution effect, and tea accounted for an insignificant component of the Consumer Price Index (CPI) basket of goods in most tea consuming countries. However, while carrying out this preliminary study, the Secretariat found that a more significant factor impacting the global tea economy was the rising tea prices. This document discusses the short and medium term impact of the recent increase in international tea prices, using the FAO World Tea Model.