Shan State tea hits the German market
MYANMAR tea could be returning to its days of international glory – with German help.
Premium Tea Company Tee Gschwendner, based in Meckenheim, Germany, is importing 1.5 tonnes of Myanmar green tea for the very first time.
The company, which is buying worldwide only the best 0.5 percent of the yearly harvest, thus becomes the first German importer of the tea produced at the community-based model factory in Sikya Inn village, Pindaya township, Shan State.
“The project is part of a bigger project to support SMEs, focusing on the specific area of Shan State,” said Matthias Plewa, senior adviser of the Myanmar-Germany Private Sector Development (PSD) of GIZ.
“This is a showcase and a pilot project that other places can replicate,” he said.
The Sikya Inn factory opened in May, 2015, and exports began in September, said Mr Plewa, adding that a contract had been drawn up for the export of a further 3.5 tonnes next year.
PSD is working with the Myanmar Tea Cluster which is part of the Myanmar Fruit and Vegetable Producers and Exporters Association (MFVP) to develop the whole teaproducing chain, including farmers, processors, traders and exporters.
“We’re doing this project because we want to rebuild the Myanmar tea industry,” said Thomas Schneider, chief adviser to PSD.
About 14 local farmers in Pindaya township supply the factory.
“We started three years ago to create a strategy about where they [industry stakeholders] would like to be in the next five years. They said they would like to go for organic certification, to improve quality and we would like to reach specific export markets as well as the domestic market,” he said.
Mr Schneider said his organisation chose Myanmar because the market has great potential.
In the past, he said, Myanmar tea was renowned for its quality, but the industry had lacked the support to grow.
The community-based model green tea factory in Sikya Inn village was partially funded and technically supported by GIZ. Samples were twice sent to Germany for laboratory analysis which revealed that it was completely clean from pesticides.
Mr Schneider said the factory was the first in Shan State to process green tea as a community-based project. The state has no manufacturing above the cottage-industry level. Two more factories have been built in Ywarngan township.
“There is not much Myanmar tea on the international market. You will probably not find Myanmar tea in shops abroad,” he said, adding that some people in Europe still recall Myanmar’s tea industry.
GIZ is hoping that improved quality measures will give a boot to exports in the future.
“To export the tea, we need a phytosanitary certificate from the crop protection department. An export licence is required, so this time we’re exporting under the MFVP association,” said PSD technical expert U Ye Lin Oo said.
Mr Plewa said he hoped the factory could be granted an organic certificate by next February.
“But the export price is more than double that of the domestic market, and the yield can be doubled only if the pruning technique is changed,” he said.
U Kyaw Thiha, vice chair of Myanmar Tea Cluster, said getting an organic certificate was very expensive for exporters. Without support from the government or another organisation, farmers would not be able to afford it.
“To access an international market in large volumes, funding is very important. The previous government could not support SMEs, and neither has the new government so far,” he said.
U Kyaw Thiha said there were more than 800,000 acres (320,000 hectares) of tea plantations countrywide, with more than 600,000 acres (240,000ha) in Shan State.
“Domestic demand has increased in the past few years as instant tea salad has become popular among consumers,” he said.
U Ba Si, who owns a 7-acre tea plantation at Sikya Inn village, said it was not easy for smallholders to export.
“The certification process is very complicated. We can export this time thanks to GIZ and MFVP,” he said. “With the poor processing system they had in the past, we didn’t get good prices in the domestic market either. We hope many more countries will import our tea by 2020, when we can prepare for organic plantations in the whole township,” he said.
A worker tends to wilting tea leave prior to processing.