Darjeeling tea estates up for sale due to global recession, may be turned into resorts

Darjeeling tea may be the finest Indian variation of the beverage, but it’s now leaving a bad taste for estate owners, with demand sliding downhill. Last year, India’s Tea Board barred blending inferior imported tea with premium Indian leaves. This pushed out Tata, which is one of the biggest buyers for Darjeeling tea, as it also faced scrutiny over blending the homegrown variant with Nepali imports.

With demand from Japan and Europe drying up as well, almost half of Darjeeling’s tea estates are up for sale. Since the West Bengal government allows use of 15% land on the plantations for tea tourism, local real estate developers are eyeing the properties for resorts. From 11 million kilogram of tea 10 years ago, production of Darjeeling tea went down to 6.7 million kilogram in 2021, but demand failed to pick up. While European buyers are under pressure due to recession, shipments to Japan went down after protests that brought operations to a standstill for four months in 2017.

Smaller players unable to stand their ground

Although larger groups with multiple plantations are holding on to their land, those with single estates are ready to sell and exit for survival. Across 87 estates in the hills of Darjeeling, the industry is finding it hard to support 55,000 workers, without significant demand recovery in global as well as Indian markets.

Revival on the horizon elsewhere

In contrast to the situation in Darjeeling, high demand for orthodox tea from India is going to make your cup of tea expensive. Although Indian tea exports have declined by 20% in the past five years, disruptions in Sri Lanka caused by the economic crisis, may revive global demand. Although Assam tea bagged more than its Darjeeling counterpart in a special auction, production in the state dropped by 17% due to floods, and continues to suffer due to climate change.