Global Tea Prices Simmer: Why Your Cuppa Could Cost More
Global tea prices have been on the rise throughout 2026. According to Trading Economics, the contract for difference (CFD) tracking tea commodity benchmark prices reached 234.94 Indian Rupees (INR) per kilogram on 27 June 2026, which is approximately Rp 44,168/kg.
This position represents a 3.04% increase compared to the previous day’s trading. Over the last month, tea prices have risen by 12.89%. When compared to the same period last year, the increase reached 14.09%. Nevertheless, current prices remain below the all-time historical high of INR 262.91/kg recorded in September 2020.
Despite these daily and monthly increases, the overall outlook for the tea market remains unchanged. International institutions still estimate that tea prices will move lower throughout this year because global supply remains at a sufficiently high level.
According to the World Bank’s Commodity Markets Outlook report from April 2026, the average price of tea from the world’s three main auction centres experienced a decline in Q2-2026 compared to the previous quarter. These three auctions are located in Mombasa, Kenya; Kolkata, India; and Colombo, Sri Lanka, all of which serve as primary benchmarks for international tea trade.
Prices at the Mombasa auction dropped by approximately 6% in May before the market recovered and remained relatively stable. Meanwhile, prices in Kolkata and Colombo have continued to weaken over the last two months.
This divergence in trends is related to supply conditions in each respective region. Tea production in South Asia has increased, ensuring that global supply remains maintained. Northern India and Bangladesh recorded significant production increases during this year’s harvest season. This additional supply has offset concerns regarding unfavourable weather in several East African producing nations.
With stocks still adequate, buyers have the leeway to delay large-scale purchases. This condition makes it difficult for price increases to persist in the long term, even if occasional strengthening occurs due to weather factors or trading activities.
Another factor weighing on the market is consumption. Demand from the Middle East and North Africa (MENAP) region has not yet fully recovered. As this region is a vital destination for global tea exports, the slowdown in purchasing is exerting pressure on international market prices.
On this basis, the World Bank predicts that tea prices will fall by approximately 2% throughout 2026. This projection continues a weakening trend after average prices had already corrected by about 4% in 2025.
Market prospects are expected to improve in 2027 as global demand normalises. An increase in consumption is expected to help absorb the currently large supply, thereby reducing pressure on prices.
Nevertheless, risks to the tea market have not entirely disappeared. One primary concern stems from international trade routes in the Strait of Hormuz. If shipping disruptions persist longer than expected beyond the third quarter of 2026, distribution flows to the MENAP region could potentially be disrupted.
Such a situation could slow down import activities in the region and prolong weak demand. The impact would be most significant for East African producing nations, which rely on the MENAP region as one of their primary export markets.
Under these conditions, the global tea market is expected to remain under pressure throughout 2026. The price increases seen at the end of June are largely driven by short-term trading dynamics, while the fundamental direction remains determined by supply levels and the slow recovery of global demand.