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Strategy Briefing

Tea in Eastern Europe

Apr 2017

US$1,325

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About This Report

New Report Guarantee

If you purchase a report that is updated in the next 60 days, we will send you the new edition and data extract FREE!

Eastern Europe is home to the highest level of tea consumption in the world, which helped it to reach annual retail sales of USD4 billion in 2016. The region is led by Russia, where black tea was able to ride out years of economic difficulties to keep growth positive. Elsewhere, newer forms of tea, such as green tea, are starting to take share from traditional black tea in countries such as Poland.

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Overview

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Gain competitive intelligence about market leaders. Track key industry trends, opportunities and threats. Inform your marketing, brand, strategy and market development, sales and supply functions.

Eastern Europe leads the world in tea consumption thanks to the outsize role played by Russia

No other region has per capita tea consumption as high as Eastern Europe, but this is mostly due to just one country: Russia. While Russia’s size and exceptionally high consumption rates heavily skew the regional averages, consumption is also relatively high in most of the rest of the region, including the second and third most populous states of Ukraine and Poland.

There is a strong historical divide in tea drinking habits in the region

The region’s countries are divided in two by tea drinking habits. One group is historically shaped by Russian influences, and prefers black tea to any other kind of hot beverage. Other than Russia itself, this group includes Belarus and Poland. The other group is less tied to Russia historically, and prefers fruit/herbal tea, although coffee is usually the preferred hot beverage overall. These countries are found in the southeast, and include Croatia and Romania.

Macroeconomic problems stemming from Russia took their toll on the category in the recent past

The onset of recession in Russia during the review period, because of a combination of low oil prices, sanctions and geopolitical disputes, caused shock waves throughout the region, much of which is closely tied to Russia economically. This did not affect black tea significantly anywhere outside Ukraine, where recession was deepest, but it had an effect on the growth of less traditional forms of tea, such as green tea, which consumers tend to shy away from in times of belt-tightening in favour of black tea.

A slow transition away from black tea towards green and fruit/herbal tea is taking place

The maturity of the black tea category has made additional growth quite difficult to achieve, especially as the region sees population decline. The prospects for green and fruit/herbal tea are stronger, as consumers are becoming interested in trying out new forms of tea, and health and wellness trends are sweeping the region.

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Introduction

Scope

Key findings

Regional Overview

Putting Eastern Europe into context

Consumption is highest in Russia and lowest in the Balkans

Value growth is highly inconsistent due to inflationary effects

Russia dwarfs the rest of the region

Not all of the region is as crazy about tea as Russia

A strong divide exists between the black tea and fruit/herbal tea markets

Fruit/herbal tea is the category driving growth

Black tea takes a hit in key non-Russian markets

Black tea is relatively safe from income shocks, but green tea is not

Standard black tea in Russia sees the largest absolute growth

Supermarkets takes major share from traditional retail channels

Things to watch in tea in Eastern Europe

Leading Companies and Brands

Market is relatively fragmented

Orimi Trade leads the region because of its position in Russia

The global tea companies are less reliant on Russia

Private label is on the move in Eastern Europe

Forecast Projections

The relative importance of the key markets will not change

Key growth categories vary considerably by market

GDP growth will be important to regional growth

Trends in product development

Growth prospects are in category-switching

Country Snapshots

Russia: Market context

Russia: Competitive and retail landscape

Poland: Market context

Poland: Competitive and retail landscape

Ukraine: Market context

Ukraine: Competitive and retail landscape

Czech Republic: Market context

Czech Republic: Competitive and retail landscape

Hungary: Market context

Hungary: Competitive and retail landscape

Slovakia: Market context

Slovakia: Competitive and retail landscape

Romania: Market context

Romania: Competitive and retail landscape

Lithuania: Market context

Lithuania: Competitive and retail landscape

Macedonia: Market context

Macedonia: Competitive and retail landscape

Bulgaria: Market context

Bulgaria: Competitive and retail landscape

Latvia: Market context

Latvia: Competitive and retail landscape

Georgia: Market context

Georgia: Competitive and retail landscape

Serbia: Market context

Serbia: Competitive and retail landscape

Croatia: Market context

Croatia: Competitive and retail landscape

Slovenia: Market context

Slovenia: Competitive and retail landscape

Estonia: Market context

Estonia: Competitive and retail landscape

Bosnia-Herzegovina: Market context

Bosnia-Herzegovina: Competitive and retail landscape

Appendix: Industry Forecast Model

About Euromonitor International’s Industry Forecast Model

Soft drivers and the Industry Forecast Model

Growth decomposition explained

Significance and applications for growth decomposition

Key applications for Industry Forecast Models

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Megatrends

Strategy Briefing

Tea in Eastern Europe

New Report Guarantee

About This Report

New Report Guarantee

Overview

Why buy this report?

Eastern Europe leads the world in tea consumption thanks to the outsize role played by Russia

There is a strong historical divide in tea drinking habits in the region

Macroeconomic problems stemming from Russia took their toll on the category in the recent past

A slow transition away from black tea towards green and fruit/herbal tea is taking place

Want to find out more about this report?

Table of Contents

Introduction

Scope

Key findings

Regional Overview

Putting Eastern Europe into context

Consumption is highest in Russia and lowest in the Balkans

Value growth is highly inconsistent due to inflationary effects

Russia dwarfs the rest of the region

Not all of the region is as crazy about tea as Russia

A strong divide exists between the black tea and fruit/herbal tea markets

Fruit/herbal tea is the category driving growth

Black tea takes a hit in key non-Russian markets

Black tea is relatively safe from income shocks, but green tea is not

Standard black tea in Russia sees the largest absolute growth

Supermarkets takes major share from traditional retail channels

Things to watch in tea in Eastern Europe

Leading Companies and Brands

Market is relatively fragmented

Orimi Trade leads the region because of its position in Russia

The global tea companies are less reliant on Russia

Private label is on the move in Eastern Europe

Forecast Projections

The relative importance of the key markets will not change

Key growth categories vary considerably by market

GDP growth will be important to regional growth

Trends in product development

Growth prospects are in category-switching

Country Snapshots

Russia: Market context

Russia: Competitive and retail landscape

Poland: Market context

Poland: Competitive and retail landscape

Ukraine: Market context

Ukraine: Competitive and retail landscape

Czech Republic: Market context

Czech Republic: Competitive and retail landscape

Hungary: Market context

Hungary: Competitive and retail landscape

Slovakia: Market context

Slovakia: Competitive and retail landscape

Romania: Market context

Romania: Competitive and retail landscape

Lithuania: Market context

Lithuania: Competitive and retail landscape

Macedonia: Market context

Macedonia: Competitive and retail landscape

Bulgaria: Market context

Bulgaria: Competitive and retail landscape

Latvia: Market context

Latvia: Competitive and retail landscape

Georgia: Market context

Georgia: Competitive and retail landscape

Serbia: Market context

Serbia: Competitive and retail landscape

Croatia: Market context

Croatia: Competitive and retail landscape

Slovenia: Market context

Slovenia: Competitive and retail landscape

Estonia: Market context

Estonia: Competitive and retail landscape

Bosnia-Herzegovina: Market context

Bosnia-Herzegovina: Competitive and retail landscape

Appendix: Industry Forecast Model

About Euromonitor International’s Industry Forecast Model

Soft drivers and the Industry Forecast Model

Growth decomposition explained