North American Tea Market Growth: A Promising Future
The North American tea market is expected to register a CAGR of 3.45% over the next five years. The perceived health benefits of green tea, herbal tea, and fruit tea are increasing in popularity. Consequently, tea consumption is rising in the region. According to Statistics Canada, the amount of tea available for consumption per person in Canada increased to 82.04 liters in 2021 from 63.69 liters in 2018.
Surge in Herbal Tea Popularity
The herbal tea segment is anticipated to grow significantly in the coming years. Known for its health benefits, such as improving immunity, the herbal infusions market is expanding in North America. Consumers are exploring a diversity of flavors and blends, especially natural and organic options. For example, California-based Numi Organic Tea launched the ‘Stay Healthy’ functional herbal tea line, featuring effective plants like Echinacea, Elderberry, Dandelion Root, Kanna Leaf, and Burdock Root. These blends are designed to help users relax, boost immunity, and combat common cold symptoms.
Steady Growth Across Seasons
The tea market is experiencing steady growth due to strong consumer preference in the United States, while Canada shows a more modest response. Tea consumption in North America is consistent year-round, regardless of weather conditions. Canadians have recognized the health benefits associated with tea and the wide variety of tea offerings, driving demand during the forecast period.
Healthy Hydration Driving Market Growth
Tea consumption in North America is driven by consumers’ search for non-alcoholic beverages as alternatives to fruit juices and carbonated drinks. The convenience of bagged tea makes it a suitable, healthy alternative. Healthy hydration refers to tea’s ability to provide instant refreshment and mild stimulant benefits, which are considered less harmful compared to coffee and energy drinks. The organoleptic versatility of tea allows manufacturers to innovate, aligning with healthy trends resonating in the North American market.
Product Innovation and Market Expansion
The tea market is boosted by its health-promoting profile, variety of herbal variants, new pack sizes, and organic options. Manufacturers are launching new products in response to the growing demand for healthy tea. For instance, the UK-based Clipper Tea Company has expanded its product range in the United States, introducing new packaging and flavors such as Organic Earl Grey Black Tea, Organic Orange Turmeric Herbal Tea, Organic Winter Apple Lemon Herbal Tea, Organic Winter Apple Cinnamon Herbal Tea, and Organic Winter Berry Herbal Tea.
United States: Leading Tea Consumption
The United States has been identified as the second-largest importer of tea globally. Tea consumption in the U.S. has surged, making it the most popular beverage in the country. According to the International Trade Center trade map, the top three most valuable tea import markets were Pakistan ($596.5 million), followed by the United States of America ($531.8 million) and Russia ($436.5 million).
North American Tea Industry Overview
The North American tea market is highly competitive, with regional and global players capturing a significant market share. Leading companies include Hain Celestial Group Inc., Bettys Taylors Group, Associated British Foods PLC, Bigelow Tea Company, and Traditional Medicinals Inc. These players focus on leveraging opportunities in emerging markets to expand their product portfolios and increase market share. Companies compete on various factors, including product offerings, quality, taste, aromas, price, functionality, size, packaging, and marketing/branding activities to gain a competitive advantage.
