Thursday Apr 23, 2026
Thursday Apr 23, 2026
Thursday, 23 April 2026 05:54 - - {{hitsCtrl.values.hits}}
Asia Siyaka Commodities yesterday said the escalation of tensions between the US, Israel, and Iran significantly impacted tea exports in March, following the bombing of Iran on 28 February and subsequent retaliatory attacks on Israel and the Gulf States.
The resulting closure of the Strait of Hormuz caused severe disruptions to shipments, with exports in the first two weeks of March falling sharply. Cargo already in transit was rerouted, and, in some cases, discharged midway.
According to Customs data analysed by Siyaka Research, tea exports in March declined by 16% year-on-year (YoY) to 19.7 million kilograms (Mnkg), compared to 23.4 Mnkg in the same period last year. Consequently, total exports for the first quarter fell to 60.3 Mnkg, down from 63.2 Mnkg a year earlier.
Despite the decline in volume, there was a notable improvement in the composition of exports.
Value-added products accounted for 59% of total exports in 1Q 2026, up from 56% the previous year. Tea Packets made up 44% of exports, while Tea Bags contributed 11%. Instant Tea exports increased to 1.6%, and Green Tea accounted for 2%.
Although export volumes dropped by around 5%, rupee earnings were maintained at Rs. 109 billion, largely due to the depreciation of the local currency against the US dollar. However, in dollar terms, earnings fell by 5% to a three-year low of $ 351 million, compared to $ 370 million last year. This translates to an approximate Free on Board (FOB) value of $ 5.82 per kilogram, slightly below the previous year’s $ 5.87.
Higher freight charges, increased insurance costs, and the need to reroute shipments are likely to have further reduced the net dollar value of exports.
Regionally, shipments to the Middle East and North Africa declined sharply in March, affecting overall 1Q performance. However, cumulative exports based on January and February figures remain relatively strong. Iraq remained the largest market, with volumes marginally declining to 8.7 Mnkg from 9 Mnkg last year.
Exports to and via Turkey showed strong growth, more than doubling from 3.3 Mnkg to 7 Mnkg. Russia recorded a 16% YoY decline, dropping from 6.3 Mnkg to 5.3 Mnkg. Azerbaijan followed with 3 Mnkg, primarily in bulk shipments.
The United Arab Emirates experienced a steep 40% decline, from 4.5 Mnkg to 2.7 Mnkg, largely due to disruptions in the Gulf during March. Meanwhile, exports to China, Japan, and the Australasia region remained stable YoY, with no significant disruptions to trade flows.
