A Call for Standards

The last decade has seen a boom in what the industry calls “specialty tea,” but if you ask for a definition you will come away confused.

What is so special about specialty tea?

Not much. A close examination reveals commodity tea that has been adulterated in some way, typically by blending pieces of fruit, exotic herbs or flower petals. Since these ingredients are dried, tea blenders spray (yes, spray) on lots of flavor.  In my view, commodity tea includes any large-scale tea manufacturer where the production goal is quantity over quality. There are great quantities of traditional tea growing in every tea producing country. These include green, puer tea, wulong, white and black tea. There are also an endless variety of herbals incorrectly labeled teas.

Why set standards for specialty tea?

Without standards, the market faces chaos. Where would France be if it had not established standards for wine almost 500 years ago? Italy followed and prospered. Stop and think, would the debate over which is better — Italian or French wine — have turned out differently if the Italians had been the first to set standards?

It’s important to understand that standards not only define products, they establish markets, and whoever defines a market, controls it. The French, beginning with standards, established formidable markets for their wine. Specialty coffee retailers have done the same.

The chaos in the specialty tea market comes from the fact that no one, from buyer to seller, actually knows the value of the tea they are buying or selling, or how to clearly establish its value. Price is derived mostly from marketing — price is certainly not based on the quality of the tea. In a practical sense, words like quality, value, and excellence have been watered-down into obscurity.

Nowadays, tea is whatever the merchant says it is – a practice that encourages dubious interpretation. In contrast, standards are consistent and independently verified. The specialty coffee industry has done an excellent job of establishing standards, which has led to levels of excellence and increased profitability enjoyed by the entire coffee industry.

Coffee and tea were at first rarities reserved for the rich. Each evolved into a commodity for the masses and both are gradually becoming artisanal offerings – the choice of connoisseurs.

Everyone my age remembers that back in the day, coffee selections amounted to either the Red Can (Folger’s) or the Blue Can (Maxwell House). At neighborhood diners and corner cafes coffee cost a quarter. This was coffee’s so-called First Wave. Americans annually drank an average of 10 lbs. of coffee per person. Per capita consumption was measured by the gallon because commodities are cheap.

The turning point was 1974 when independent coffee shop owners established a standard for “Specialty Coffee.” The adoption of standards launched the Second Wave. Pioneers such as Alfred Peet at Peet’s Coffee & Tea, Starbucks, and Coffee Bean & Tea Leaf would not exist without these standards. Innovations in growing, sourcing, roasting, packaging, and coffee brewing followed.

The market for specialty coffee was more sophisticated, resembling its European counterparts. Coffee of this quality commanded a higher price; it no longer had to be cheap. Thus specialty coffee became easily distinguishable from modity coffee.

Coffee’s Third Wave emerged around 2002 when small coffee businessmen traveled to coffee farms to source direct and eventually became experts in every aspect from growing to roasting to brewing. This took the small retail coffee businesses to a new level of profitability. An independent shop’s offerings differentiated it from the likes of Starbucks. Stumptown in Portland, Intelligentsia Coffee in Chicago and Blue Bottle in San Francisco insisted on transparency and quality improvements along the entire supply chain. Not only did standards raise retail margins for retailers, the discovery of great coffee also opened the door for wholesale roasters selling to other quality businesses whose business prized artisan coffee. Grocery outlets like Whole Foods Markets began to feature locally roasted coffee.

The Third Wave aspires to an even higher level of coffee experience. It begins with direct sourcing. Only direct sourcing can insure quality and answer questions about fair trade and farming methodology with confidence. Third Wave coffee also places high value on production and preparation: the goal is to get the best possible cup. Third Wave coffee owes its existence to Starbucks for building the market for better coffee, and for establishing the benchmark. Third Wave roasters realized they needed to get a whole lot better to beat Starbucks, and to do so they needed expertise and transparency along the entire supply chain.

Similarly, three years ago Starbucks changed the tea market dramatically for small independent tea businesses when they bought Teavana. Today every small tea business is compared to the nearest Teavana, like it or not.

The difference between coffee and tea is that there are no standards that give a tea business the tools needed to beat Teavana. Starbucks redefined the market for coffee on almost every level. They will do the same for tea. Small tea businesses and major tea corporations alike are going to feel the heat. Without standards, Teavana, with its extraordinary marketing muscle, can define tea quality any way they want.

If standards for specialty tea mirrored the standards for specialty coffee, the only tea that could quality as “specialty” is tea judged to be within the top 20% produced. Most of the tea sold as specialty tea in the West would be disqualified. I predict that few multinational billion dollar tea companies are going to support quality standards for tea.

Why would they?

Tea’s Third Wave

In 2014 Jesse Jacobs, founder of Samovar Tea, wearing a cream-colored canvas apron over a fashionable t-shirt, announced the coming of the tea industry’s Third Wave.

Is the tea industry really on the verge of entering into a movement equivalent to that of the coffee industry? It is going to take the tea industry a very long time to catch up to the sophistication of the coffee industry. The discussion about standards for specialty tea has just begun.

Looking forward, a profitable market for small tea businesses will require standards. These standards need to be objective, understandable, and replicable. Standards provide growers with a definable goal for crops and harvesting. Standards enable tea makers to formulate products clearly identified by buyers, which give the producers incentive to improve. Direct sourcing will become increasingly important for the tea retailers. Consumers will demand to know what they are paying for, when it was plucked and where it originated.

Establishing standards brought extraordinary advantages to small coffee growers including unimaginable financial success. Think what standards for quality would mean for smallholders in Southeast Asia and India and Africa, areas still economically strangled by the colonial commodity system. Establishing an objective quality standard raises the value that can be communicated through the entire supply chain: excellence rewarded.

Right now China is realizing the benefits of standards in its domestic market for tea. Their tea industry was virtually destroyed during 150 years of war and internal strife. As China recovered following World War II and the Mao era, the tea produced was mediocre at best. In the 1990s China established standards for quality and freed tea makers to create and profit from their own business. Since then, China has experienced a renaissance in tea making; teas produced for the domestic market are the best in history. China is now the largest tea producing country in the world. The Chinese consistently get the highest prices for their tea, and China has the highest average price for tea. China has the best tea in the broadest categories; it has defined standards, and grows the largest percentage of tea using traditional, chemical free growing practices.

The coming of standards is inevitable. Small businesses that are dedicated to quality in real terms, not just in the marketing of their products, will benefit.

It took years for standards to significantly improve coffee, but things will move quicker with tea due to the benefits of the information age. The tea industry is ready for professionals to lay the groundwork for “Third Wave” tea. Let’s leave it to Teavana to push the second wave along in building the market, like their parent company did for coffee.

What is great about getting the ball rolling towards standards for quality (and eventually for excellence) is that small businesses that are struggling to establish new business models need not worry, for the best practices for quality in the tea industry go beyond the reach of corporations, economies of scale, and the deep pockets of marketing departments. Standards are the essential tool for the tea entrepreneur.

So become a pro, take some Chinese classes, and get your passport up to date, and by all means study the specialty coffee industry. They are experts in coffee on every level.

Standards, direct sourcing, transparency, expert level knowledge about tea and its culture, logistical mastery, inventory management expertise, and tea preparation skills are all requirements for ushering in tea’s Third Wave. Herein lays opportunity, challenge, and the promise of excellence. Let’s hope tea entrepreneurs’ passion for tea is strong enough to take them where they’ll have to go.

Austin Hodge is the founder of Seven Cups Fine Chinese Tea in Tucson, Ariz. http://www.sevencups.com

These 12 characteristics provide a baseline for assessing quality. Tea that meets these standards can be considered ‘specialty’ grade. Each element may be described in greater detail. Drilling down into these criteria is important in determining excellence.

1. The condition of the leaf – addresses the skill of the tea maker. The leaf should be intact and, with few exceptions, unbroken.

2. Adherence to the plucking standard – addresses the skill of the picker and the garden managers.

3. Uniformity of the leaf – also addresses the skill of the picker, and the garden managers

4. Origin

5. Harvest date

6. Cultivar

7. Tea maker

8. Processing

9. Percentage of moisture remaining in the tea

The first nine are objective anchors for examining quality. Without this information, authenticity becomes impossible to verify, making the quality objectively questionable.

10. Color

11. Aroma

12. Taste

Items 10 to 12 require multiple measurements at differing times. These last three criteria demonstrate a more subjective evaluation done by professionally trained evaluators with significant experience.

All of this information must be disclosed in order for the tea to meet the minimum standard. The goal is a clear differentiation between specialty tea, where the focus of the whole tea making process is quality, instead of quantity.