As in coffee, some of the increase in retail volume sales for tea in 2020 is attributable to the customer base buying more of the products for home consumption, with many people being advised to work from home earlier in the year due to COVID-19. However, any stockpiling only took place for the first two weeks of the Movement Control Order (MCO), which was put in place on 18 March.
Bigger, more famous brands in retail have been better positioned to perform stably during the pandemic, with stronger supply chains and access to a wider range of consumers. Moreover, they typically have better marketing power to promote their products.
Similar to coffee, as local coffee shops and mamak stalls were affected by the smoking ban implemented in Malaysian eateries from January 2019, tea in on-trade establishments saw a mild impact, pre-pandemic. Nonetheless, on-trade performance over the review period was underpinned by the strengthening popularity of fresh-brewed tea shops and cafés.
After some deceleration in 2021 as consumers move back to foodservice, the green tea retail category is likely to continue to post strong, consistent volume sales growth for the remainder of the forecast period. More and more consumers are predicted to switch from the largest category of black tea to green tea to receive the perceived functional benefits, with COVID-19 making them increasingly mindful of their intake and general health and wellness.
Tea performance in off-trade establishments over the forecast period will be bolstered by consumers’ desire for the beverages’ health benefits and antioxidant properties. Apart from green tea, fruit/herbal tea is set to make further solid gains due to its health appeal.
Malaysia is a tea-producing country with several local tea manufacturers setting up plantations in hilly locations at higher altitudes. As the tourism industry in Malaysia grows, both people of local origin and people from overseas seek to visit the plantations to enjoy the chilly climate and greenery.
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Understand the latest market trends and future growth opportunities for the Tea industry in Malaysia with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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This report originates from Passport, our Tea research and analysis database.
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