# Tea: Extraction

Why leaf must reach the factory within hours

Source page: https://www.materialinsights.org/commodities/tea/extraction/

What this tab covers How it is mined, drilled or grown, and processed into a tradeable form: the main methods compared, their unit economics, by-products, and the companies that do this work globally and in India.

Tea bushes grow in warm, wet climates with acid soils, often on hill slopes in China, Assam, Kenya and Sri Lanka. Bushes are pruned to waist height and plucked every week or two for decades. Leaf must reach a factory within hours. For black tea it is withered, rolled or cut by CTC machines, oxidised and dried; for green tea, oxidation is stopped by steaming or pan-firing. Fresh leaf weighs several times as much as finished tea, so check the basis when reading statistics.

Tea is a perennial crop, so supply depends on the area under bushes, their age and the weather. There are two farming models: large estates with their own factories (Assam, Darjeeling, Sri Lanka, Kenya's multinationals) and small growers who sell green leaf to cooperative or private bought-leaf factories (Kenya's KTDA system, India's small tea growers, China). Processing then splits into CTC black, orthodox black and green tea. In India small growers now supply more than half of output. Rising wages and flat auction prices have squeezed estates: ITA says about 80% of organised estates reported cash losses in the year to its October 2025 AGM.

#### Methods compared

| Method | Share of supply | Typical scale | Recovery / efficiency | By-products | Unit cost |
|---|---|---|---|---|---|
| **Estate production with own factory (Assam, Dooars, Darjeeling, Sri Lanka, Kenya multinationals)** | India's big growers made 605.0 of 1,395.5 million kg (43.4%) in 2025 (Tea Board) | McLeod Russel's 39 estates (31 in Assam, 2 in the Dooars, 6 in Uganda) produce more than 80 million kg a year (company website) | green leaf yield about 10.0 t/ha in India and 11.8 t/ha in Kenya in 2024 (FAOSTAT, fresh-leaf basis); fresh leaf to made tea roughly 4-5:1 (indicative, derived from Indian data) | tea waste for caffeine extraction and instant tea | India all-auction average price Rs 188.03/kg in 2025, down Rs 11.27/kg on 2024 (ITA); estate cost of production not found in sources used |
| **Small growers selling green leaf to bought-leaf factories (India, Kenya, China, Sri Lanka)** | India's small growers made 790.5 of 1,395.5 million kg (56.6%) in 2025; in West Bengal 285.7 of 421.6 million kg (67.8%) (Tea Board) | Assam has about 1,150 small tea gardens and 800 large estates (ETV Bharat, citing Tea Board) | n/a | n/a | Assam raised the agricultural income tax exemption for small growers from Rs 2.5 lakh to Rs 10 lakh from 1 April 2026 (ITA); green leaf prices not found in sources used |
| **Processing: CTC, orthodox and green tea manufacture** | n/a | India produced 1,395.5 million kg of made tea in 2025, North India 1,161.3 and South India 234.2 (Tea Board) | n/a | tea waste | n/a |

#### How each method works
**Estate production with own factory (Assam, Dooars, Darjeeling, Sri Lanka, Kenya multinationals)**

Estates own the land, bushes, housing and factory, employ resident workers who pluck by hand, and process their own leaf. They sell through auctions or direct contracts with packers. Labour is the main cost, and statutory welfare duties such as housing and medical care add to it.

Control of quality and brand value, but high fixed labour costs and falling real prices.
 Tea Board annual production 2025; ITA, Tea India 2026; McLeod Russel company profile; FAOSTAT 2024 **Small growers selling green leaf to bought-leaf factories (India, Kenya, China, Sri Lanka)**

Smallholders with a few acres pluck and sell green leaf daily to nearby bought-leaf or cooperative factories. In Kenya the KTDA-managed factories process smallholder leaf and sell at Mombasa. In India small growers expanded fast in upper Assam, north Bengal and the Nilgiris.

Low overheads and fast growth, but variable leaf quality and weak bargaining power over green leaf prices.
 Tea Board annual production 2025; ITA, Tea India 2026; ETV Bharat, 5 February 2026 **Processing: CTC, orthodox and green tea manufacture**

For CTC, withered leaf passes through rollers that crush, tear and curl it into small granules, then ferments and dries. Orthodox tea is rolled to keep whole or broken leaves. Green tea is heated before rolling to stop oxidation. Made tea is then sorted into grades (leaf, broken, fannings, dust).

CTC is efficient and cheap; orthodox and green earn higher prices but need more skill and smaller markets.
 Tea Board annual production 2025 Unit economics are indicative ranges from the sources named; costs vary widely by deposit, region and year.

#### Who does it: global

| Company | Country | Activity | Volume | Year | Source |
|---|---|---|---|---|---|
| **McLeod Russel India** | India | estate tea producer (Assam, Dooars, Uganda) | 80 million kg black tea a year (more than) | annual, as stated in 2026 | [McLeod Russel company profile](https://www.mcleodrussel.com/corporate/company-profile.aspx) |
| **Tata Consumer Products (Tetley, Tata Tea)** Tea volumes not found in sources checked | India | blending and branded tea | not published | FY2026 | not available |
| **LIPTON Teas and Infusions (CVC Capital, formerly Unilever's ekaterra)** Private company; volumes not published | Netherlands | branded tea and estates | not published | 2025 | not available |
| **Kenya Tea Development Agency (KTDA)** Volume not found in sources checked | Kenya | manages smallholder factories | not published | 2025 | not available |
| **China Tea Co. (COFCO)** Volume not found in sources checked | China | tea trading and brands | not published | 2025 | not available |

#### Who does it: India

| Company | Country | Activity | Volume | Year | Source |
|---|---|---|---|---|---|
| **Tea Board of India** | India | regulator; statistics; e-auction system | 1,396 million kg all-India production (BG 605.01, SG 790.52) | 2025 | [Tea Board, annual production 2025 and 2025-26](https://teaboard.gov.in/pdf/Annual_Production_2025_and_2025_26_pdf5398.pdf) |
| **Indian tea exporters (aggregate)** | India | exports | 286 million kg (Rs 8,659.44 crore) | 2025 | [Indian Tea Association, Tea India 2026](https://www.indiatea.org/uploads/ITA-Tea-India-2026.pdf) |
| **McLeod Russel India** | India | largest estate producer | 80 million kg a year (more than) | annual, as stated in 2026 | [McLeod Russel company profile](https://www.mcleodrussel.com/corporate/company-profile.aspx) |
| **Tata Consumer Products** Volume not found in sources checked | India | largest branded packer (Tata Tea) | not published | FY2026 | not available |
| **Hindustan Unilever (Brooke Bond, Lipton in India)** Volume not found in sources checked | India | branded packer | not published | FY2026 | not available |

India is the second-largest producer (1,395.5 million kg in 2025; Assam 699.6 and West Bengal 421.6) and the largest consumer of black tea; it exports about a fifth of output and imports about 40 million kg. Small growers now produce 56.6% of the crop, and most estates are under margin pressure.

## Other sections

- [Summary](https://www.materialinsights.org/commodities/tea/index.md)
- [Overview](https://www.materialinsights.org/commodities/tea/overview/index.md)
- [Correlation](https://www.materialinsights.org/commodities/tea/correlation/index.md)
- [Production](https://www.materialinsights.org/commodities/tea/production/index.md)
- [Stocks](https://www.materialinsights.org/commodities/tea/stocks/index.md)
- [Cycles](https://www.materialinsights.org/commodities/tea/cycles/index.md)
- [Trading](https://www.materialinsights.org/commodities/tea/trading/index.md)
- [Movement](https://www.materialinsights.org/commodities/tea/movement/index.md)
- [Criticality](https://www.materialinsights.org/commodities/tea/criticality/index.md)
- [Characteristics](https://www.materialinsights.org/commodities/tea/characteristics/index.md)
- [Emissions](https://www.materialinsights.org/commodities/tea/emissions/index.md)
- [Relationships](https://www.materialinsights.org/commodities/tea/links/index.md)