Taste for South Africa’s rooibos tea attracts Starbucks

Business is brisk these days for the 600 or so growers of rooibos, a caffeinefree herbal tea unique to South Africa’s Western Cape province whose clients include Starbucks Corp.

Production of the crop more than tripled to 14,000 metric tons the past decade as farmers expanded rooibos plantings to meet demand from companies including the world’s largest coffeeshop operator and Nestle SA, the biggest food company.

Tea consumption is increasing as health-conscious consumers spurn sugary and caffeinated beverages. Rooibos, like green tea, contains antioxidants that boost the immune system, calcium and fluoride. The drink constitutes about 10 percent of the herbal tea market and 1% of a global tea market that has an estimated value of $23 billion, according to the South African Rooibos Council.

“Five years ago, rooibos was really quite a niche product,” said Paul Jefferies, a London-based herbal-tea buyer for Tata Global Beverages Ltd.’s Tetley, which sells about 300 tons of the tea a year under its Red Bush label. Thanks to “a very strong marketing campaign, sales have been on a steep upward curve.”

Starbucks offers vanilla rooibos “herbal infusion,” while Nestle sells rooibos-flavored yogurt. Hain Celestial Group Inc. introduced its African Orange Mango Rooibos tea to the US seven years ago.

Specialty teas

Specialty teas including rooibos account for about 9% of the $2.1b. US tea industry. The UK saw a 300% increase in rooibos sales from 2003 to 2007.

Associated British Foods Plc’s Twinings tea division said rooibos now makes up 2.6% of its sales, with Unilever NV’S Lipton unit also ranking among the top sellers.

“The demand for rooibos increased rapidly during the tea has last few WILLIE NEL, who grows rooibos near Clanwilliam, about 230 kilometers north of Cape Town, is banking on the hardiness of the plant to keep his farm and the 60 workers it employs going. ‘There is no other production plant you can grow here,’ he says. years,” Carl- Olof Skeppstedt, creative director at London-based tea consultancy Tatler & Brown Ltd., said in an email. “Taste, health benefits and the lack of caffeine are some of the main reasons for the increase.”

The biggest export markets for rooibos, which counts Nobel Peace Prize-laureate Desmond Tutu among its fans, include Germany, the Netherlands, the UK and the US, according to the South African Rooibos Council.

Rooibos, Afrikaans for red bush, was first popularized outside of South Africa during World War II when Allied nations had trouble obtaining tea from Asian countries.

Needle-like leaves from the almost twometer shrub, native to an area northwest of Cape Town that includes the Cedarberg mountains, have been used in traditional medicine for generations to treat allergies, digestive issues and colic.

Rooibos extract is used as well in soap and cosmetics. That’s resulted in the product going more mainstream, found from Paris street markets to London grocers.

About 5,000 people work at rooibos farms and processing plants, one of the biggest employers in South Africa’s semidesert Suid Bokkeveld region, where the jobless rate can exceed 80%.

Changing weather patterns may pose a threat to the industry’s success. Government-commissioned research shows temperatures in South Africa may rise as much as 3% and rainfall may drop as much as 10% by mid-century, with the rooibos-growing area considered among the most vulnerable.

Hardy plant

“If as they predict temperatures would go up one or two degrees, rainfall were to go down a bit, we’d be in trouble,” Martin Berg, managing director of Rooibos Ltd., which operates the country’s biggest processing factory, said in an interview.

Willie Nel, 45, who grows rooibos near Clanwilliam, about 230 kilometers north of Cape Town, is banking on the hardiness of the plant to keep his 3,550hectare (8,770-acre) farm and the 60 workers it employs going. The crop is endemic to a region where summer heat can hit 48 degrees Celsius (118 degrees Fahrenheit).

Rooibos constitutes about 10% of the herbal tea market and 1% of a global tea market that has

an estimated value of $23b.

“There is no other production plant you can grow here,” Nel said, gesturing at hundreds of rooibos bushes that stretch across the sandy fields he has farmed for 25 years.

“We are dealing with an indigenous plant that’s adapted to harsh conditions,” Guy Midgley, head of the South African National Biodiversity Institute’s climate and bio-adaptation unit, said by phone from Cape Town. “The risk will definitely rise in the longer term, but that’s two decades out.”

Nel said he has yet to notice a change in weather patterns that pose a threat to his livelihood and expects to continue farming rooibos until he retires.

“Maybe my sons will feel the impact,” he said. (Bloomberg)