socio- economic implications of climate change for tea producing countries

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Socio- economic implicatio ns of climate change for tea producing countries

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Page 1: Socio- economic implications of climate change for tea producing countries

Socio-economic implications of climate change for tea producing countries

Page 2: Socio- economic implications of climate change for tea producing countries

OutlineIntroductionImplication of climate change for teaSocio-economic implications

◦The estate sector◦The smallholder sector

Impact of climate change on the world tea market

Adaptation measures for tea cultivationConclusions

Page 3: Socio- economic implications of climate change for tea producing countries

Introduction

Document CCP:TE 14/4 uses information to assess some socio-economic implications for tea producing countries

Mitigation = attempts to reduce greenhouse gas emissions at their source

Adaptation = attempts to reduce vulnerability to climate change

Page 4: Socio- economic implications of climate change for tea producing countries

Implication of climate change for teaTea is:• Important cash crop• Plays a significant role in • Rural development• Poverty alleviation• Food security

• Planted in 58 countries3.36 million hectares under tea

cultivation (2012)4.78 million tonnes produced (2012)

Page 5: Socio- economic implications of climate change for tea producing countries

Implication of climate change for tea (cont’d)

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

-30

-20

-10

0

10

20

30

40

50

60

Comparative growth rates in area and yield in Sri Lanka (1985-2013)

area yield

perc

ent

Page 6: Socio- economic implications of climate change for tea producing countries

Implication of climate change for tea (cont’d)

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

-20

-15

-10

-5

0

5

10

15

20

25

30

35

40

Comparative growth rates in area and yield in Kenya (1985-2013)

area yield

perc

ent

Page 7: Socio- economic implications of climate change for tea producing countries

Implication of climate change for tea (cont’d)

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

-25

-20

-15

-10

-5

0

5

10

15

20

25

30

35

Comparative growth rates in area and yield in China (1985-2013)

area yield

perc

ent

Page 8: Socio- economic implications of climate change for tea producing countries

Implication of climate change for tea (cont’d)Implications of climate change:

Dry soil top if mulching is not applied • Increased incidence of new pests and diseases • More carbon dioxide being released into the

atmosphere through deforestation• Reduced or uncertain rainfall patterns and

limited ground and river waterMain issues include of tea’s environmental

footprint:• Reduced biodiversity and ecosystem function• High energy consumption• High application of pesticides in some countries.

Page 9: Socio- economic implications of climate change for tea producing countries

Implication of climate change for tea (cont’d)

1985 1990 1995 2000 2005 2010 20150.00

50.00

100.00

150.00

200.00

250.00

300.00

350.00

Nominal and real prices of tea

Nominal Prices

Real Prices

Year

FA

O C

om

posit

e P

rice

(U

S c

ents

)

Page 10: Socio- economic implications of climate change for tea producing countries

Socio-economic implications: the estate sectorIssues estates are facing:•Erosion of top soil• Increased use of fertilizers• Increased usage of pesticides•Addressing longer dry seasons and heavier rains

Page 11: Socio- economic implications of climate change for tea producing countries

Socio-economic implications: the estate sectorIncreasing costs of mitigating

climate change raise serious socio-economic issues:• Low wages and low-quality housing• Health and safety• Declining workforce• Casual or short-term employment• Gender discrimination• Diminishing workers’ representation

Page 12: Socio- economic implications of climate change for tea producing countries

Socio-economic implications: the smallholder sector Change in supply structure from large plantations to

smallholders Smallholders in Sri Lanka responsible for 76% of

total production Smallholders in Kenya responsible for 62% of total

production Issues constraining smallholders:• Low farm gate prices• Poor extension services• Limited market channels• Little or no access to credit • Low level of farmer organization.

Changes in weather patterns:◦ Possible income loss due to decrease in plucking days (G.

Boriah, Tea Board of India).

Page 13: Socio- economic implications of climate change for tea producing countries

Impact of climate change on the world tea market

Blending, packing and marketing of tea are the most profitable and controlled by a handful of multinational tea packers and brokers

Real prices for tea on the shop shelves have not increased over time but have in nominal terms.

Average real auction prices between 2000-2008 roughly half of those in the 1980s

Auction prices have increased somewhat since 2008.

Challenges for most producing countries:• Capturing value addition in tea supply chain • Increasing quality• Rising costs to meet food safety standards

Sri Lanka, India and Kenya successful in capturing value addition

Page 14: Socio- economic implications of climate change for tea producing countries

Impact of climate change on the world tea market (cont’d)

Table 1. Climate change scenario Impact at the world level

Average percentage change between baseline and simulation

Price 26.3

Consumption -3.3

Production -3.4

Export 2.3

Page 15: Socio- economic implications of climate change for tea producing countries

Impact of climate change on the world tea market (cont’d)

Impact of climate change on the world tea prices (USD/kg)

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

Simulation

Baseline

Page 16: Socio- economic implications of climate change for tea producing countries

Adaptation measures for tea cultivationAdaptation measures

recommended by the Working Group on Climate Change:• Planting drought and stress tolerant

tea cultivars• Diversifying production• Intercropping tea with other tree

crops• Organic cultivation• Water conservation

Page 17: Socio- economic implications of climate change for tea producing countries

Conclusions Evidence that GHGs are causing global warming and climate

change Climate change will have a significant impact on future tea

production Several uncertainties are not yet fully understood:

◦ Frequency of natural disasters◦ The proliferation of certain pests and diseases◦ Higher infrastructure cost.

Recommendations:◦ Agricultural and socio-economic adaptation strategies are required in

the short term◦ Tea producing areas should be evaluated against climate projections◦ Comparative studies are necessary◦ Possibility of breeding special tea hybrids that cope better with climate

change should be considered A competitive environment for tea production and processing

safeguarded by governments could create long-term socio-economic and environmental sustainability that will help mitigate the impact of climate change

Page 18: Socio- economic implications of climate change for tea producing countries

Thank you!