Tea Sales Top Industry Growth

Sales of the US non-alcoholic beverage industry grew 1.2% last year, according to Beverage Marketing Corporation, showing a reversal of back to back years of decline. Fueling this is the thriving tea and ready-to-drink bottled tea market; Packaged Facts reports tea sales in the US could approach $15 billion in 2012 up from $8.5 billion (foodservice share $2.8 billion) in 2009.

RTD tea leads all other segments, including RTD coffee, functional beverages, and energy drinks, with a 12.5% volume surge in 2010 alone, with overall tea category growth of 31% in the past five years. As consumers continue to explore more healthful living and eating options, beverages that promise to help achieve their health goals (e.g., manage weight, lose weight, reduce stress, manage chronic health problems, boost energy) exhibit most growth in demand.

Carbonated soft drinks remain, by far, the largest proportion of our liquid refreshment, though their share has been steadily declining over the past decade as studies continue to link the sugary drinks to a myriad of health complications including obesity and diabetes. The government has chimed in with proposed legislature to levy a tax on soft drinks containing sugar, as some states already have done. A recent study commissioned by the New York City Health Department concluded that a one-cent-per-ounce soda tax would cut consumption by 15-20% and save state residents an estimated $2.1 billion in related medical expenses.

Brands whose teas are enjoyed across a wide range of foodservice and retail categories, such as Harney & Sons, Argo, and Adagio Teas, stand to gain significantly from this swinging pendulum towards better-for-you beverages. Adagio's line of USDA Organic and unsweetened iced teas will reveal new packaging this fall to broadcast these healthful traits.