Tea valuable commodity for Saudi and Gulf states

Tea valuable commodity for Saudi and Gulf states
Updated 12 January 2013

Tea valuable commodity for Saudi and Gulf states

Tea valuable commodity for Saudi and Gulf states

During a recent trip to India, I was invited to stay on a magnificent tea plantation in Vandiperiyar, 169 km from Kochi in the southern Indian state of Kerala located on the Arabian Sea. A tropical and monsoon climate provides the region with the rains essential to growing evergreen forests and cash crops such as coconuts, rubber, tea, coffee, and spices.
More than 150 years old, the tea estate is situated in the mountains at an altitude of 1,100 meters, where tea, cardamom, black pepper, coffee and vanilla are cultivated together. I was fascinated by the seemingly unending green acres, the long rows of “manicured” tea trees, and the beautiful fertile hills where both men and women workers were plucking tea leaves.
While gazing at the tea plantation, I reflected on the importance of tea production in the world, the countries that produce it, and where it is being exported. The Food and Agriculture Organization (FAO) indicates that world tea production reached almost 4.3 million tons in 2011. More specifically, global black tea production reached 2.7 million tons that year, while green tea production attained 1.3 million tons. However, due to erratic climate conditions, global black tea production has decreased in all producing countries and has fallen in 2012 by 2.85 percent compared to the same period in 2011.
For a long time, India has been second only to China as the largest producer of tea in the world. The FAO indicates that in 2010 India produced almost 0.97 million tons of tea making up 24 percent of the world's total production. China, the top tea producer, produced 1.4 million tons of tea that same year, covering 33 percent of the world's total production.
Recent estimates indicate that in 2011, India's production reached 0.99 million tons, and China 1.6 million tons. Other foremost tea producers are Sri Lanka, Kenya, Turkey, Vietnam, Iran, Indonesia, Argentina, and Japan.
When visiting the tea factory, I learned about the different processing stages of the tea plant and was told that the wealth of the tea estate in Vandiperiyar is based on its tender leaf, which gives an excellent quality of tea, black, strong and full of flavor. I pondered on the importance of tea consumption in the world and in particular in our Middle Eastern culture.
After water, tea is the most consumed beverage worldwide - 4 million tons in 2010 - and is drunk daily in many cultures and at social events. FAO estimates reveal that in 2011 the Middle East region's consumption of 0.6 million tons of tea was second only to the Far East in global black tea consumption (the latter reaching 1.3 million tons in the same year) and Middle East consumption is projected to increase to 0.76 million tons in the next decade.
Among Middle Eastern countries, black tea consumption in 2011 was highest in Saudi Arabia, Turkey, Iran, Egypt, the United Arab Emirates (UAE), Iraq, and Sudan.
The consumption of black tea in the Gulf region started over a thousand years ago when Arab traders brought tea from Ceylon, now Sri Lanka, and from Kerala in southwest India to the Arabian Peninsula and introduced it to their culture. Tea-drinking has become for Arabs a popular family and social tradition as well as part of the daily drinking pattern.
Latest FAO data indicates that the highest annual per capita consumption of tea in the region is in the UAE reaching 6.24 kg.
A recent study on world tea consumption disclosed that in Saudi Arabia, which is the second largest consumer of tea in the Arab region, over 19 million cups of tea were consumed daily.
In the next decade, tea consumption is predicted to grow considerably in the Gulf countries. In 2021, black tea consumption is projected to reach 57,930 tons in the UAE and 22,701 tons in Saudi Arabia.
Moreover, the tea trade in the Middle East is very important. FAO data indicates that in 2010 the region's tea imports were among the highest in the world, reaching 486,000 tons.
Today in agricultural trade, tea is among the top commodities imported by GCC countries. The biggest tea importer in Gulf countries is the UAE with almost 80,000 tons imported in 2010 (FAO estimates).
According to a recent report issued by the UAE Ministry of Foreign Trade, the value of UAE tea imports grew to $485 million in 2011, and the country's share of total global tea imports increased to 9.4 percent for that same year.
The UAE, which imports tea mainly from Sri Lanka and India, re-exports the majority of its tea to Iran, the GCC region, and other countries in the Middle East. Dubai, which has been for years a regional commodity-trading center, has become a worldwide center for the tea re-export market and an international doorway for the tea trade. Due to its geographical location, it is a vital link between the tea-producing countries and the tea-consuming market. For the past five years, the UAE has held a 60 percent share of the world's tea re-export market.
To boost the tea trade in the UAE and to assist its international extension, the Dubai Multi Commodities Centre Authority (DMCC), opened in 2005 the Dubai Tea Trading Centre (DTTC), which warehouses raw tea from the major Asian and African tea-producing countries and provides services such as storing tea shipments, arranging tasting and blending
according to the specific requirements of particular countries and markets, and packaging. It is estimated that in 2010 the center processed over 10.6 million kg of tea.
Saudi Arabia is the second highest importer of tea in the Gulf region.
In 2010, according to the FAO, Saudi Arabia imported 31,594 tons of tea worth $211 million. Nearly half of its tea is imported from the UAE and the rest mainly from Sri Lanka, India, Kenya, Vietnam and Yemen.
A recent study on the Saudi hot drinks market (tea, coffee and other hot drinks) revealed that the total value of the country's hot drinks market was $ 624 million in 2011. In particular, the value of Saudi Arabia's tea market is higher than the coffee market, $ 306 million compared to $ 294 million in 2011. The market value of coffee is estimated at an increase of only 2.83 percent between 2011 and 2016.
But, it is predicted that the value of the tea market will reach $420 million by 2016, an increase of 6.55 percent.
Unfortunately, recent trends in the Gulf region have revealed that the consumption of carbonated beverages is considerably increasing among GCC population. A recent study on Saudi Arabia indicates that in 2010, 2,481 million liters of hot tea were consumed in Saudi Arabia, projected to reach 2,706 million liters in 2017 - an increase of 9 percent. But alarmingly, over the same period, the consumption of soft carbonates shows an even faster growth rate of 24.6 percent. Further estimates indicate that soft carbonates in Saudi Arabia are expected to exceed the sales of $2.4 billion by 2016.
Today, in most of the GCC countries, young people are heavily consuming carbonated drinks to quench their thirst in a hot desert climate making them addicted to the sweet taste of sodas. Furthermore, they are eager to spend lavishly on fashionable popular fizzy drinks.
Although banned in schools, soft carbonated sodas are strongly promoted and sold everywhere in stores, supermarkets, restaurants and of course in vending machines.
The consumption of soft carbonated beverages has become an extremely controversial public health issue. With rising health awareness, there is growing global concern about the negative health effects of fizzy drinks saturated with sugar and full of calories. These drinks contribute to weight gain, obesity and other health problems such as
diabetes, high blood pressure, high cholesterol, heart disease and premature aging.
As for diet sodas, although they have limited or no calories, they still contain artificial sweeteners such as aspartame, a chemical compound that may harm the brain and cause serious health problems.
In addition, carbonated sodas contain phosphoric acid, which may lead to calcium deficiency, softening of bones, and osteoporosis, dental caries, tooth enamel erosion, and heartburn. They also contain high amounts of caffeine, which may trigger restlessness, tension, insomnia and gastro-intestinal disorders. It is therefore essential to reduce the daily consumption of carbonated drinks for the sake of our health
and that of our young generation and promote a serious transition from soft carbonated beverages to healthy drinks.
After water and natural juices, tea is a healthy alternative to all kinds of sodas. More than a thousand years ago our ancestors used to drink it as a healthy and nutritious beverage. Tea is natural and calorie-free and therefore assists in maintaining a healthy weight.
Drinking tea is associated with longer life expectancy and offers a range of health-promoting benefits. Tea contains less caffeine than coffee and carbonated sodas, and is full of antioxidants and amino acids, vitamins C, E, and K, L-thiamine and fluorine.
Tea's numerous anti-inflammatory factors help to prevent the risk of certain diseases such as cancer and cardiovascular diseases. Tea also regularizes blood pressure and diabetes by lowering blood-glucose activity. It strengthens the immune system as well as the bones and prevents tooth decay. As a mood-lifter, soothing tea helps to reduce mental and physical stress.
The natural benefits of tea make it a valuable health commodity not only for drinking, but also as a business commodity for both men and women's cosmetics and perfumes. Nowadays, manufacturers of cosmetics, perfumes and skin-care products are developing new products that integrate the benefits of tea. Both black and green teas provide a powerful antioxidant in lotions and treatments to help improve the skin, with rejuvenating and anti-aging properties. Black tea is also a natural astringent and adds strength and shine to hair. All kinds of tea, including jasmine and rose tea, are now used in perfume manufacture.
In early dawn, leaving the tea estate with some bags of the best black tea from the plantation to take home to Saudi Arabia, I realized just how healthy tea is and how much it has become precious and valuable to us in the Gulf region.
— Dr. Mona AlMunajjed ([email protected]) is a sociologist,
author and adviser on social issues.


NADEC consortium submits bid for privatized Saudi flour mill

NADEC consortium submits bid for privatized Saudi flour mill
Updated 43 min 26 sec ago

NADEC consortium submits bid for privatized Saudi flour mill

NADEC consortium submits bid for privatized Saudi flour mill
  • Saudi Arabia is accelerating plans to privatize key infrastructure in an effort to modernize the economy

DUBAI: Saudi Arabia's National Agricultural Development Company (NADEC) is part of a consortium that has bid for a privatized flour mill in the Kingdom.
It has teamed up with OLAM International Limited, Al Rajhi International for Investment and Abdulaziz Alajlan & Sons Company for Commercial and Real Estate Investment, to bid for one of two mills being privatized, the company said in a stock exchange filing.
The two mills are being offered for privatization by the Saudi Grains Organization.
NADEC said  it has agreed a "term sheet" relating to the creation of a limited liability company to acquire the mill should its bid be successful.
The potential acquisition would be financed through a combination of self-financing by the consortium members and borrowing from local banks, it said.
Saudi Arabia is accelerating plans to privatize key infrastructure in an effort to modernize the economy, speed major infrastructure works and develop its financial services sector.


Dubai’s external food trade hit $14.2bn in 2020

Dubai’s external food trade hit $14.2bn in 2020
Updated 20 April 2021

Dubai’s external food trade hit $14.2bn in 2020

Dubai’s external food trade hit $14.2bn in 2020
  • The emirate imported foodstuff worth 34.7 billion dirhams

DUBAI: Dubai’s external food trade reached 52 billion dirhams ($14.2 billion) in 2020, according to government data.
The emirate imported foodstuff worth 34.7 billion dirhams, Dubai Customs manager Nassim Al-Mehairi said, while exports and re-exports were valued at 10 billion dirhams and 7.3 billion dirhams respectively.
Food security is a major issue in the UAE, which has been investing in technology that will reduce its reliance on importing key staples.
Dubai Customs has streamlined its processes to accelerate the clearance of foodstuff shipments to ensure they are delivered to markets on time, especially during Ramadan when consumption is high, Al-Mehairi said.


Saudi Red Sea tourism plan to clinch a $3.7bn green loan

Saudi Red Sea tourism plan to clinch a $3.7bn green loan
Updated 20 April 2021

Saudi Red Sea tourism plan to clinch a $3.7bn green loan

Saudi Red Sea tourism plan to clinch a $3.7bn green loan
  • The Red Sea Development Co.’s SR14 billion ($3.7 billion) loan is set to close with a small group of local banks
  • The proceeds will be used to finance environmentally sustainable investment

RIYADH: Saudi Arabia is weeks away from clinching the first significant funding package for a key part of Crown Prince Mohammed bin Salman’s program to diversify the Kingdom’s economy, Bloomberg reported.
The Red Sea Development Co.’s SR14 billion ($3.7 billion) loan is set to close with a small group of local banks including Saudi National Bank, Banque Saudi Fransi, Riyad Bank and Saudi British Bank, the newswire reported, citing people familiar with the matter.
The deal to help fund the first phase of the development will be a so-called green loan. The proceeds will be used to finance environmentally sustainable investment, the people said, asking not to be identified as the information is private. It will have a tenor of 15 years and an interest rate of about 1 percent above the Saudi interbank offered rate, they said.
The company first started approaching banks for the loan in mid-2019, Bloomberg said.
Opening to tourism is one of the ways Saudi Arabia intends to diversify the economy away from oil. Its other ambitious projects include an entertainment hub near the capital Riyadh, and the new NEOM city in the north-west, which is expected to cost $500 billion to build.
The Red Sea Development, owned by the Kingdom’s sovereign wealth fund, will oversee a luxury tourism zone equivalent in size to Belgium. When the entire project is completed in 2030, it will target 1 million visitors a year, split evenly between domestic and international tourists.
Construction of a new international airport for the area has begun, and the first phase of the project is due to be completed with the opening of four hotels at the end of 2022.
12 more hotels will be open the following year, Chief Executive Officer John Pagano said in an interview in November.


IEA issues ‘dire warning’ on CO2 emissions as it predicts 5% rise

IEA issues ‘dire warning’ on CO2 emissions as it predicts 5% rise
Updated 20 April 2021

IEA issues ‘dire warning’ on CO2 emissions as it predicts 5% rise

IEA issues ‘dire warning’ on CO2 emissions as it predicts 5% rise
  • This year’s rise will likely be driven by a resurgence in coal
  • Global energy demand is set to increase by 4.6 percent in 2021

LONDON: Global CO2 emissions from energy are seen rising nearly 5 percent this year, suggesting the economic rebound from COVID-19 could be “anything but sustainable” for the climate, the International Energy Agency said on Tuesday.
The IEA’s Global Energy Review 2021 predicted carbon dioxide emissions would rise to 33 billion tons this year, up 1.5 billion tons from 2020 levels in the largest single increase in more than a decade.
“This is a dire warning that the economic recovery from the COVID crisis is currently anything but sustainable for our climate,” IEA Executive Director Fatih Birol said.
This year’s rise will likely be driven by a resurgence in coal use in the power sector, Birol added, which the report forecast to be particularly strong in Asia.
It should also put pressure on governments to act on climate change. US President Joe Biden will hold a virtual summit for dozens of world leaders this week to discuss the issue ahead of global talks in Scotland later this year. Last year, when power use dropped due to the COVID-19 pandemic, energy-related CO2 emissions fell by 5.8 percent to 31.5 billion tons, after peaking in 2019 at 33.4 billion tons.
The IEA’s annual review analyzed the latest national data from around the world, economic growth trends and new energy projects that are set to come online.
Global energy demand is set to increase by 4.6 percent in 2021, led by developing economies, pushing it above 2019 levels, the report said.
Demand for all fossil fuels is on course to grow in 2021, with both coal and gas set to rise above 2019 levels.
The expected rise in coal use dwarves that of renewables by almost 60 percent, despite accelerating demand for solar, wind and hydro power. More than 80 percent of the projected growth in coal demand in 2021 is set to come from Asia, led by China.
Coal use in the United States and the European Union is also on course to increase but will remain well below pre-crisis levels, the IEA said.


Saudi Arabia is China's top oil supplier for seventh straight month

Saudi Arabia is China's top oil supplier for seventh straight month
Updated 20 April 2021

Saudi Arabia is China's top oil supplier for seventh straight month

Saudi Arabia is China's top oil supplier for seventh straight month
  • Shipments from UAE and Oman surge
  • Some Iranian barrels believed to have slipped in

BEIJING: China’s crude oil imports from top supplier Saudi Arabia rose 8.8 percent in March from a year earlier, driven by strong demand and as shipments delayed due to a port congestion finally arrived.
Imports from the United Arab Emirates also rose again, up 86 percent, as some Iranian barrels were believed to have slipped in. Shipments from Saudi Arabia were 7.84 million tons, equivalent to 1.85 million barrels per day (bpd), data issued by China’s General Administration of Customs showed on Tuesday.
That was higher than 1.7 million bpd a year earlier, but below imports of 1.94 million bpd in February. Saudi Arabia retained its position as China’s biggest crude oil supplier for a seventh consecutive month. Ports at China’s oil refining hub Shandong experienced congestion for a few weeks over January and February, slowing oil arrivals. China’s crude oil imports from Russia rose 6 percent in March to 1.75 million bpd from a year ago, but slipped from 1.91 million bpd in February. Analysts from Refinitiv expect arrivals from Saudi Arabia to further drop in April given a voluntary supply cut of 1 million bpd by the producer and increasing prices of Arab light crude for the Asian market.
Appetite of spot oil would turn to more price competitive African sources, with China’s imports from Angola at 0.74 million bpd in March, versus 0.73 mln bpd a month ago. The customs data also showed that crude oil supplies from Kuwait increased to 0.6 million bpd, up 29 percent from a year earlier. China’s imports from the UAE were at 0.71 million bpd last month, up 86 percent on year. Shipments from Oman rose 60 percent from a year ago to 0.86 million bpd.