Wednesday, February 09, 2011

Sustainable, Organic, Fair-Trade: A Conversation with Nigel Melican [iii]


EDITOR'S NOTE: At the 2010 World Tea Expo, Cinnabar of spoke at length with Nigel Melican of Teacraft Ltd on the topics of sustainable, organic, and fair-trade tea. What follows here is the third and final part of a three-part transcript of that conversation. Parts I and II can be read by clicking here and here respectively.

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C: When companies and managing organizations talk about sustainability, do they also talk about labor practices? Are labor rights and working conditions part of the discussion on sustainability?

NM: Part of sustainability is social responsibility, and it's a very embracing concept.

C: So it's more of a big-picture view of the tea industry ... not damaging anything in the long run.

NM: That is the way Unilever interpreted [sustainability], and they have sort of passed it on to the Rainforest Alliance. The Rainforest Alliance was a bit more on the corporate social-responsibility side, and less on the [side of] sustainable husbandry, so it's a very good match. And yes, it's right land use, it’s water use, it's energy use, erosion, bio-diversity - the whole picture ... and empowerment of the workers.

C: How that information transfers to the end consumer, that's important, but there's no recognizable label that consumers are seeing at this point that confers that much information, is there?

NM: [With regard to guarantees of sustainability and labeling] at this point, all they're getting is the Rainforest Alliance frog, which when people see that they're supposed to think about all of this.

C: But they don't.

NM: Mostly they don't even know the story. But the idea is to pass the story on, I think. If I were driving it, that's what my idea would be. Some people need a lot [of detail on where the tea comes from] and some people can't deal with a lot of information.

C: One of the statements that was made during the panel discussion - I don't remember which of the panelists said it, but it may have been the representative from the organic certification organization - was that "30% of Americans are ethical consumers."

NM: Well, that's good news. [laughs]

C: Hearing it, I thought that it really doesn't mean anything. I assume that part of what that really means on a practical level is that when they talk to people they're often likely to grab the package that has the organic or fair-trade label because they have a sense of it being better in some vaguely altruistic way. To me that does not translate into evidence that they have closely evaluated their ethics with regard to what they consume.

NM: Right, someone wrote down the script to ask, “If you had a choice and you have an ethical product and a non-ethical product which one would you buy?” 30% said, “I’d go for the one with the little frog ... because I like frogs.”

C: And 70% said ...

NM: “Frogs are slimy; no, I don’t want it.” But people make choices on that sort of a basis.

C: I don't get the impression that there are broadly-informed consumers even among tea drinkers. There's a lot of demand for organic tea or fair-trade tea, but that is sometimes at the expense of quality and at the expense of programs that will actually help people and the environment more in the long run. I don’t want to be entirely cynical, however. It's definitely good progress to be thinking in those terms instead of not caring where things come from at all.

NM: And we do have a [largely unsolvable] problem with food miles in tea. You can't get tea without it being shipped a minimum of 10,000 miles.

C: Related to those distances that tea has to travel, it's very interesting seeing tea cropping up in unexpected places like New Zealand, for example.

NM: At [the Expo] I was approached by people who want to grow tea in the West Indies and people who want to grow tea in the Philippines.

C: The Philippines seems like a place where there would already be tea growing. I can see how the culture of that region wouldn’t have produced a natural place for growing tea.

NM: Yes, [the Philippines has] an American and Spanish background. Neither of those groups are tea drinkers or growers.

C: Right. The Spanish wouldn't have brought tea-drinking or tea-growing to the Philippines, but it seems like the climate would be right for growing.

NM: I’ve often wondered why there isn't tea in the Philippines already.

C: Maybe nobody's thought of it yet?

NM: Now somebody has, and then in the West Indies too. Coffee grows in Jamaica, very good coffee, some of the best, so why not tea?

C: I would expect the tea industry in Hawaii to get bigger, in spite of problems like the one you were describing about sulfur. But that's not a huge amount of land, really is it? It’s never going to be a major player in the tea world because it's just not a big place.

NM: No, it isn’t. And with the cost of production in these countries it just has to be a high value, niche product. It would kill itself if it went large amounts. High labor costs and large amounts just don't work.

C: That would be the only way they'd be doing it in Hawaii, right? So it's not really expandable or scalable?

NM: No, it isn't.

C: It would always be small scale. I didn't talk a great deal to the people from New Zealand, but it seems like their approach and how they're growing tea in New Zealand is that way too. They're starting out at the top with very expensive tea and really high quality.

NM: The Taiwanese guy wanted to grow tea in New Zealand, and food regulations in New Zealand are so rigorous, because they are a food exporting country, that the only sort of tea that he could grow passed the regulations. That puts him in a high-cost situation, even though he brings in Taiwanese workers to pluck the tea. He flies them in, and that costs a lot of money!

C: The cost of getting the tea from one place to another is expensive, but importing your labor force ...

NM: Yes - it puts your carbon footprint up! So he is really forced into that area where he has to charge $500 a kilo, and he must match the quality that people expect for that price, and he has. He's done a superb job.

C: Yes, he has, and he may be able to take up some of the slack for drops in production in Taiwan. So much of Taiwanese tea is not sustainable due to the environmental devastation and dangerous conditions surrounding the tea growing regions.

NM: A lot of Taiwanese tea – [some of what gets sold as] Formosa Oolong - is grown in [mainland] China.

C: I’ve heard that.

NM: You have to ask the vendor, specifically, "where was this grown?" The Japanese are doing exactly the same: they offer a “Sencha,” it might mean, "grown in the style of the Japanese" by Chinese workers who have been trained by the Japanese, who are making it on Japanese-supplied equipment. But actually, it's Chinese-supplied Sencha.

C: There's even Sencha coming out of Brazil. It's not very good ... and really that's different, because it is clearly identified as being from Brazil, not misrepresented as Japanese tea.

NM: I had an inquiry at the show from [a tea grower from] an unspecified country for machinery to make Sencha tea. I resource machinery, so I'll happily source him [the equipment], if he can afford it. But the source will amaze people: "Well I didn't know they grew Sencha there!"

C: The attempts at growing one place’s regionally-specific tea in a different location seem strange to me, because if you're taking a type of tea varietal and growing it somewhere else, with a totally different climate and different soil conditions, it's not going to taste the same. It seems like the more reasonable approach, rather than trying to reproduce a traditional kind of tea in a new place, would be to figure out what works best under the new conditions, and represent the tea as a new type, but perhaps that's not as marketable.

NM: If you look at consumers, they often go for what they know. Someone who knows a Sencha will always, given an unknown tea or the old-fashioned one that they know and love, they'll choose the one they know and love. But you're right, that's what they ought to do, and it's what I push people in Africa to do, to take the plants that they were growing for CTC tea, and do wonderful things with it.

C: and the specialty teas coming out of Africa are wonderful, some of them. They're not like teas grown somewhere else. They have their own character, which is wonderful. But that industry is probably getting to the point where it's starting to mature, because it's been around long enough, as opposed to a country that's been growing tea for six months.

NM: I generally find that my clients who've only been doing something for six months are much more imaginative, much less traditional, much more prepared to try and leap ahead.

C: Because they have less to lose?

NM: Less to lose and more to gain. And they're going to invest anyway, and it's much better to invest to get ahead rather than invest just to be behind.

C: Is there a lot of tea growing in South America?

NM: 40% of US tea comes from South America. Overall there's not a lot, but you import a disproportionate amount of that tea mainly for three reasons: it's close by, it's cheap, and it has no taste whatsoever.

C: So it fits the American palate?

NM: Yes: without being insulting, it's ideal for iced tea. Because it doesn't go cloudy, has good color, and has a taste that is easy to flavor. It's never bitter, which Americans hate. So it's a good match.

C: I don't think it's widely known that there's tea coming from South America. But that's within the tea community, and the tea community is not generally talking about the source for iced tea anyway.

NM: How many people care where their iced tea came from?

C: Nobody does. But that's an interesting thing, because no-one is talking about organic farming for the tea production that goes into iced tea in the United States, but why not?

NM: Look at the consumer profile of the people who drink iced tea.

C: They don't care, and it wouldn't occur to them that that would be a concern.

NM: Again, not to be insulting, but the main thing for them is, "shall we get a Big Mac?”

C: Or sweet tea? McDonald's is selling Sweet Tea now. I think there's a big discrepancy in those two consumer bases in the United States and even that statement about "30% of all Americans are ethical consumers" - that's of the small number of people they talk to. I think that the mainstream American consumer is not in a position of wanting to evaluate the labels or think about organic farming.

NM: Not just America, anywhere in the world you can say that. There's a small percentage in most countries who are concerned, interested, and will pay a little bit extra, but for the majority, it doesn't impinge upon them at all. But one of the reasons why the tea trade was never very keen on organic tea was because it downgrades their main tea. If you say, "this tea is organic, it contains no pesticides," the immediate thought is, okay what about the regular tea? The traders, the big boys, were never particularly keen. I keep using Unilever as an example because I know Unilever and know their workings. I don't think you'll find a Unilever organic tea on the market anywhere in the world, because it would signal to consumers that their other tea is non-organic.

C: Which brings up another important issue, that organic and fair trade, and all of these things bring the cost of the end product up. Ultimately, if the standard practices become more sustainable will those labels go away and not be necessary. Is that a trend, do you think?

NM: I don't know about in all things, but in tea, organic tea has had a good run and it will move aside for sustainable [tea]. I think already they're seeing that the prices they can get are coming down. They're coming closer to the standard tea prices. [Organic tea producers] can't get that premium anymore.

C: But the impact overall in the industry is probably a good thing, to try to encourage better practices and to get consumers to start thinking about the wider implications of what goes into bringing that tea to the cup.

NM: I think generally it's a good thing. The only problem is where you have small farmers who are not in groups who cannot afford to get on board. But that's the downside. The upside may be that it will encourage them to form small groups. And [some of them will] never be able to do it. [Some of the very small specialty producers] don't have a great deal of opportunity, but [they have] a high-value product, and can afford to do the certification if [they] wish.

C: It seems that in the tea industry, among people who are drinking the more high-end expensive teas, they're not drinking anything that comes out of a grocery shelf box with an organic label on it in the first place, but they're hopefully paying more attention to actually how the tea is produced. I see a divide between the really top-end production of really expensive specialty teas versus the whole of the tea industry.

NM: Yes, there is [that difference].

C: The labeling and the focus on ethical practices has a smaller impact on this part of the tea industry than it does on this other part of the tea industry, partly just functionally because if this tea isn't being produced in a plantation that is using a labor force that is being exploited because the business model doesn't work that way in the first place ...

NM: Yes, it's about business model; it's about ethos; it's about transparency - and if you are selling real high-value tea then you're not going to put DDT on it just because you've got some aphids. You're going to say, "what would our customers expect us to do?" and use a biological control. And that's exactly what [those tea producers] will do. And once you're using biological controls, the strange thing is you can't use pesticides, because it kills away your controls.

C: I find it really fascinating that there is a certain very small part of the tea industry that is centered around wild-tea growth - in Yunnan Province, for example, where these plants are thousands of years old and they're still being harvested, but they're growing in natural forests. The tea trees grow within the natural ecosystem alongside the other native foliage and animals. The yield per acre is probably minuscule, but that's about as sustainable as tea production could possible be. It's not practical for worldwide tea production, of course, even if you could recreate a “natural” tea forest in another place, but it’s a very interesting model for preservation.

NM: Talking about Rishi, that's their bread and butter.

C: Because they've got people that they can sell it to, that are interested in that. It's good that there's enough interest to keep those tea plants and their environments safe where they are.

NM: ... for another thousand years ...

C: ... at least.

NM: I have my doubts about those thousand-year-old trees. The Chinese are very elastic on their large numbers. They have this thing that any big number is ten thousand. No-one's going to believe a ten thousand year old tea plant, but a thousand is a big number. They're pretty old, I agree.

C: And who knows how old the actual forest is. It doesn't matter anyway, but it's quite interesting that there are places where really sustainable tea means just leaving it growing as a tea plant as one element of the local ecosystem, and having it do whatever it does, and having it picked by the ethnic minority that lives in that area that has picked the tea for hundreds of years.

NM: Or by monkeys ...

Monday, February 07, 2011

Sustainable, Organic, Fair-Trade: A Conversation with Nigel Melican [ii]


EDITOR'S NOTE: At the 2010 World Tea Expo, Cinnabar of spoke at length with Nigel Melican of Teacraft Ltd on the topics of sustainable, organic, and fair-trade tea. What follows here is Part II of a three-part transcript of that conversation. Part I can be read by clicking here.

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Cinnabar: When a farm changes over from chemical fertilizer to organic fertilizer, does that decrease the yield enormously?

Nigel Melican: A lot depends on conditions. I warn people to expect at least a 30% drop in yield. If you've got access (and you shouldn't go into it if you haven't got access) to farm-animal manure, or suitable green sources of fertilizer like compost, then gradually you build it up again. It will never build back up to the level that you get with intensive chemical fertilizer, though. The world average for made tea is about 1000-1200 kilos a hectare. When I went into tea first 30 years ago, the people I was working with -- the good ones -- were getting 2.5 tons a hectare. Now they're getting 4.5-5 tons a hectare.

C: Mostly because of the improvements in fertilizer?

NM: No, improvements in management. The improvements in fertilizer came in around about the ‘80s or ‘90s, but all the way along, people were improving different things. First they brought in herbicides. What they'd been doing was weeding by hoeing, which destroys roots. As soon as you stop hoeing and put herbicides onto weeds, you get a huge jump in your yield. Now the herbicides are banned and you've got to use husbandry practices like planting more densely. All the time they're improving, research and development is improving practices, and the yield responds, productivity responds. With good clones, good practice, good fertilizer, intensive farming, you can get 11 tons a hectare ... it's been done. It’s not the world averages, though, and on an organic farm you'd never do that.

C: An organic farm would never reach that yield?

NM: Never say never, but it's unlikely. It would be theoretically possible. I would like the challenge ... but I don't think anyone's going to pay me to do it. There's an awful lot of bunk talked about organic. The purists say, “yes, it must be absolutely organic, and the phase of the moon has got to be right.” But to the plant, an organic nitrogen molecule or atom is totally similar to an inorganic one. The plant can't tell the difference.

C: I guess there are really two focuses of organic farming. I wasn't even thinking about how it affects the end product, because it seems like that's not the same conversation. The impact on the land is quantifiable and obvious, but the land doesn't know the difference between a molecule of nitrogen, whether it’s certified organic or not, right?

NM: No the land won't, but -- and this is why there's the argument -- people say that organic meat tastes better than inorganic meat, and often it does, because the guy who grows organic takes better care of his animals, is a better animal husband, and that shows up, and it's the same with plants.

C: And that's clearly the case with tea. If you're using practices that end up contaminating the end product with dangerous toxic chemicals, the end product is going to taste bad, so that's not going to fly.

NM: Ultimately you're right, but if you had -- God forbid -- tea contaminated with mercury you wouldn't taste it, and similarly, many of the ways that you fertilize don't have an effect on taste. Where you do have an effect with organic on tea is that you're putting on less nitrogen. Nitrogen leads to fast growth, and fast growth tends to be more about kilograms than it is about quality ... so slow growth, as in the spring flush. Everyone says, go for the spring flush. That's because it's growing slowly, and the quality is definitely better. So organic should come out with slower growth.

C: But in reality, the quality of a lot of product that's labeled as organic tea is terrible.

NM: Yes.

C: I've had some organic tea that was awful, nearly undrinkable. I don't know why that was, but I suspect that it's coming from sources that aren't terribly knowledgeable about tea production.

NM: People are struggling because they're not doing organic very well. There are some good ones, and there are a lot of people struggling. The example I gave of the company that cut out fertilizer to cut cost and got organic certification, they're not doing the best job in the world.

C: Is it that they don't know the best way to grow tea?

NM: I think they know the best way, but they're not doing it. I've had some of their tea and it was not so good. I've also had some of their tea and it's been excellent.

C: My understanding, gained through what I’ve been told in a number of places, is that some of the small estates and small individual tea farms in China, as one example, are growing their tea organically partly because they can't afford expensive chemical fertilizers, so they're using traditional agriculture, which is, by definition organic, but they won’t ever be able to say that their tea is organically produced even though it is.

NM: Yes, well they certainly won't be certified, so they can't be officially organic. And yet, for thousands and thousands of years they've been organic ... and balanced organic. They're sustainable and organic, because they recycle everything back to the land.

C: Traditionally, sustainable agriculture is what works. If you're a small farmer you need to create a system of growing that you can keep going and recycling.

NM: As a small farmer you need to, because you have no choice. Unilever has done it, but they don't have to do it.

C: What are Unilever plantations in India like today?

NM: Unilever doesn't own any farms in India anymore, not one single one.

C: All of their tea farms are in Africa now?

NM: Yes, the ones they have, and they've sold a lot of the ones in Africa too. They've gotten out of vertical production. The second biggest tea company in the world, Tata, has done exactly the same. They've gotten rid of their tea farms in India -- and they're an Indian company! What happened in India was that all tea plantations laid down by the British 150 years ago ... after independence the government saw them as being exploitative and they created all sorts of rules about how the workers on the estate had to be looked after. The plantation owners had to give them subsidized food, and decent housing, and community hospitals and schooling, and what they call the social cost of growing tea under those conditions got out of hand. The responsibility of maintaining an estate that might have a couple thousand workers, with a family structure of 30 thousand or so becomes really high. I worked with an ex-Assam planter in Papua New Guinea, and he had been like the mayor of a city. He had 30,000 people under his control!

C: That's workers, and worker's families?

NM: That's right, and he was the magistrate, he was the mayor, he was the employer. He had all these responsibilities. Companies like Unilever and Tata said it was okay when everyone was in the same boat, but then what happened was that people started growing tea without the factory and selling tea to factories that didn't have any estate of their own. They were called “bought-leaf factories,” and they had no social costs. People want to grow tea on their own, that's their choice ... no subsidy. So they were selling tea to the bought-leaf factory at about half the cost that Unilever could make tea cost, so Unilever said, “how about we offer the plantations to the workers, and we'll buy the tea, and we'll help with the transition to owning their own factory and plantation.” So, all these huge tea gardens are now owned by Indian smallholders.

C: They're still selling the tea to Unilever, but Unilever doesn't own the factories or the plantations.

NM: And the price of tea has come down effectively to the bought tea factory level.

C: Then in the meantime has Unilever started new plantations in Africa that they run?

NM: No they haven't started any new ones. I don't think they're ever going to start any new ones.

C: They're mostly just buying from plantations that are owned by other people?

NM: That's right, and where they have plantations they maintain them. There's not a great deal of interest in being a huge plantation owner anymore for all the social reasons I've just gone through. But where they've got them and can't sell them, like in Kenya, they keep them on. I wouldn't be too surprised to find them selling them eventually, because there is a lot of interest in buying plantations in Africa, there are Indian interests. An Indian company, McLeod Russel, which is now the biggest tea-plantation-owning company in the world, has just bought four plantations in Uganda from Finlays. Finlays traditionally was a plantation company, only now ... I think they have a few left in Darjeeling, but very few.

C: That's a big shift in the whole industry in terms of who owns the base level tea production. Was the majority of that shift in the past ten or twenty years?

NM: Within the last ten. The Indians have been coming over to Africa and buying up the tea estates in Uganda, Rwanda and anywhere else they can find. The Chinese are also coming in, but not buying tea estates. They're building a huge tea-extract factory in Dar Es Salaam, Tanzania and also, one of the deals that the Chinese bring to the table is that they build parliament buildings for all these little countries. Malawi's parliament building was built by the Chinese, or at least heavily funded by the Chinese, and they throw in universities.

C: Speaking of China and tea in Africa, I've read in a number of places that the greatest importer of Chinese tea is Africa because the traditional forms of tea drinking in Africa use Chinese green teas.

NM: But that's mostly north of the Sahara.

C: Yes, but it's interesting because the tea drinking in Africa and the tea growing in Africa have nothing to do with each other, even though they’re on the same continent.

NM: Well, most of the North Africans don't consider themselves African at all. They have a different heritage.

C: But even in Senegal and Gambia there's the Ataya tea drinking tradition which uses Chinese green tea, and those countries have little to no cultural or ethnic connection with North Africa.

NM: Yes, but that's not a tea-growing area either.

C: No, but I can imagine a gradual shift in production of the southern African tea production to start producing more green tea and to sell to this huge market that's closer at hand.

NM: Yes, and 20 years hence it may well happen. The Chinese are drinking more of their own tea, and the rise in the middle class means you get more of the local market. India has gone from drinking none of the tea grown there 100 years ago to 80% of its tea now.

C: I remember those figures from your talk during the Expo. Do you know what current Chinese consumption of its own tea is?

NM: I could look up figures for you, but it's probably about 60-70% [actually 83% in 2009]. That’s traditionally, not as retail packed tea, but the retail packers are coming in. Unilever is big in China, selling packed tea.

C: Are Unilever and the other big companies selling packaged tea that they're buying from Chinese production factories?

NM: Some of them. I did a project in the ‘80s in China looking for a factory for Unilever to acquire to do tea growing and packing in China for sale. They didn't go ahead with actually buying the factory, but they certainly went ahead with the packing factory in the ‘90s. They're even selling slimming tea now in China.

C: What would you say the difference is between sustainable farming versus organic and fair-trade? I mean, I understand what the difference is as expressed in the marketing language, but more specifically ...

NM: Well, sustainable really means that you're not using things up. Just as with organics, there are sustainability purists who say you should never use anything that can't be replaced. And there are the sustainable realists who say we should at least eke out the non-renewable resources where we can, and wherever we can we'll use renewable fuels, and if it's not renewable we'll go very carefully how we use it and how much of it we use. You have to draw that distinction. My camp is the realistic sustainability one.

C: You can't set up restrictions that are so harsh that it makes it impossible to produce anything.

NM: People do.

C: I know they do, but they shouldn't because ultimately it won't work.

NM: I'll give you an example of the dilemma that you might get into. I was working with a new tea grower in Hawaii -- not one of the small guys that we've seen at the Expo, but someone who wanted to do it on a hundred-acre scale, 200-acre scale. He wanted to be organic, said the production must be organic. He was a berry farmer on the mainland, and he always had an organic farm, and he wanted to have an organic tea farm. So we started off and sourced his tea and his raw materials from Africa and got it planted, and his soil was not acid enough, which is unusual for Hawaii, but this was an old sugar-cane plantation and they'd put down a lot of chalk, to benefit the sugar cane. This was 20 years ago, but it was still there. The normal way that you'd acidify soil for tea is to put sulfur on it. Sulfur is recognized by the organic people; they're happy with it. So he goes off to his supplier and when he sees the sulfur that he's offered, he says, "where does it come from?" and they say it's a by-product of the petrochemical industry, and he throws his hands up in horror! So we look and see what else we can get. It's possible to get sulfur which is rock sulfur, mined sulfur. The dilemma is, would you rape the countryside with big holes, ripping out rock sulfur, or would you use a by-product of the petrochemical industry that has to go somewhere, and is at least greening the petrochemical industry at least a little bit?

C: Why would the organic regulations say that you couldn't use petro-chemical by-products?

NM: the regulations don't say that you shouldn't, but they would prefer that you use the natural sulfur.

C: "Organic" meaning that you take it from the earth regardless of consequences? That makes no sense.

NM: No it doesn't make a lot of sense. That's why I say that sustainability and organic should be done with some degree of realism.

C: None of the national or international organizations that are promoting organic farming are really thinking in terms of sustainability, are they? I prefer not to make such a broad statement, but it seems like the focus is on something that's almost more conceptual than practical.

NM: Absolutely, yeah that is the focus, because it's all mediated in glass palaces in Europe or America and the people there don't get out in the field a lot, and don't see the issues directly and they have a set of ethics that they want to plant.

C: I could tell that, just listening to the people in the panel discussion talk about it. They haven't all stood in a tea field. The way some of them were talking about the agriculture, they didn't really understand how it worked. That distance from agriculture and the people directly involved in it also manifests into a somewhat condescending tone among some of the organizations promoting the organic, fair-trade and sustainability agendas. Even the representative from Utz was talking about teaching the farmers like they were five-year-olds and their organization was going to come in and teach them the right way to do things.

NM: Absolutely right. David Walker, President of Walker Tea, LLC, was telling someone a couple of days ago about how he represents a couple of coffee growers in Kenya and helps them get product to market. He was saying that some of these USAID people will come over and say to the Kenyans, “we're going to teach you how to grow coffee the way the Americans like it.” [laughs] He took one of these coffee industry advisors aside, put his hand on his shoulder and said "these people have been growing coffee for three or four hundred years. They know how to grow coffee. You tell them how you want it. They can do it, but don't go telling them that you're going to teach them, because you are not.” So there's a lot of that element of “experts who know best.”

C: Yes, it can be really preachy. The attitude about it is very removed from the reality of actual workers and actual plantation owners and actual growers, and for that matter, from the science of it, how things work. Although, I will say that the Rainforest Alliance was a little less like that because they seem like they're a little bit more direct about how they get things done.

NM: Of all the [certification] bodies, they're the one I have the most time for. The one that started up in the UK, the “Ethical Tea Partnership,” or ETP, has almost collapsed because the Rainforest Alliance has a much more sensible view of things. Unilever used to be in the Ethical Tea Partnership and I think they pulled away, because they were being targeted, which they didn’t really care for. They had done so much of their own sustainability work that they went in with the Rainforest Alliance and that has bolstered the Rainforest Alliance so much; it's given them so much of a head start.

C: Obviously, the Rainforest Alliance is concerned with forests, and the land around forests, and that pretty much covers the whole tea industry worldwide, doesn't it?

NM: Well, in that Unilever is one of the big people getting certification and they buy from all countries, virtually, yeah, they’re in all countries. And yes, there are people certifying in Indonesia, certifying in Tanzania, in Kenya, and Rwanda and India. I think it’s been a very good strategic alliance, for the Rainforest Alliance to go with Unilever.

[[to be continued]]

Sustainable, Organic, Fair-Trade: A Conversation with Nigel Melican [i]


EDITOR'S NOTE: Like a convergence of heavenly bodies, the exquisite Cinnabar -- founder, editor, and lead writer for the indispensible site -- and the eminent Nigel Melican, owner of Teacraft Ltd and one of the world's most eminent scientific experts on the topic of tea -- came together recently at the World Tea Expo. It was the great good fortune of CHA DAO that Cinnabar agreed to contribute a guest entry, in the form of an interview, and that Nigel agreed to be interviewed on this occasion. We are tremendously grateful to them both. ¶ What follows here is a transcript of that interview. Because it was a substantial conversation, we shall be publishing it in three instalments; this is Part I.

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A few months ago, at the World Tea Expo in Las Vegas, Nigel Melican of Teacraft Ltd was gracious enough to grant me some of his valuable time to sit down and talk about sustainability, organic farming, fair-trade labor practices and related labeling and certifications within the tea industry. The following is a transcription of our conversation, slightly edited for improved clarity. The conversation took place in the sweltering atrium of a Las Vegas hotel, our voices competing fiercely with the blasting onslaught of smooth jazz being piped in over our heads.

Cinnabar (C): I have to admit that I'm somewhat skeptical of the programs and labeling for fair trade and organic farming.

Nigel Melican (NM): Yes, so am I. I met a Fulbright scholar in Tanzania who was looking at certification and the way that it impacts on small farmers across all the certifying possibilities in Tanzania that are open to them. Though she wouldn't say on record that she thought they were marketing hype to sell more tea, not to the advantage of the farmers necessarily, that's definitely her overlying view.

C: There's a lot of controversy about fair-trade practices in tea production in India. There's been a lot of backlash saying that workers aren't actually getting any benefit from it. Even though the plantations get certified, there's no follow-up after that to make sure that the benefits are actually going back into the community.

NM: Yes, it's looking bad. There are certain companies who, if someone in the company really believes in it then they'll follow it up and make sure that happens. But it can either slip between marketing and, I suppose, human resources, although very few tea companies have the sort of human resources department on the producers' side, and there must be some direct exploitation as well. Generally I think they go into it for the right reasons, but it doesn't always deliver in the way that it's supposed to.

C: In the panel discussion “Social Responsibility and Certifications: A Panel Discussion” (presented at the World Tea Expo in June of 2010), there was someone from one of the major the organic certification programs in the United States, and someone from Transfair, someone from Utz, and someone from the Rainforest Alliance. At a point someone in the audience was asking some pretty pointed questions about the ability of small farmers to be able to afford to get certified. And the representatives from the two big certification organizations said, essentially, "uh, it's to their advantage to get certified, because they make more money," but the people from the other two organizations were running programs that were a little more flexible. It was quite an interesting discussion. Then Joshua from Rishi Tea talked about how his company deals with some small farms that don't have the resources to get officially certified. They work with them directly and make sure that the tea producers are doing everything ethically and responsibly and Rishi presents that information directly to the consumer, which seems to me like it’s much more straightforward and useful than a certification label.

NM: But a company like Rishi, you can trust them. There are a lot of companies who are ... well, I wouldn't trust with my wallet ... Joshua's a nice guy.

C: Yes.

NM: There are shades of niceness. The tea industry used to be a wonderful profession, you know -- they used to treat their labor force pretty badly -- but amongst themselves, they were honorable men, and everything was done on a handshake. I've been in the tea business for thirty years, and I've seen it sort of go the way of the world.

C: Do you see situations where the organic practices are conflicting with the fair-trade practices?

NM: I can't actually think of anywhere they conflict, though people perhaps go into them for different reasons. Organics is much more about helping the land, and making it have an attractive product to market, than helping the actual worker and having an attractive product to market.

C: Yes, the focus is different.

NM: But I can't think of any examples of conflict between fair-trade and organic, and many people are practicing both.

C: Yes, I’ve noticed that there are plenty of companies that state that they're both on their labels. I'm skeptical of the labels because I'm not sure if there's really as much behind it as the label means ... a label's just a label.

NM: Well the label is a prompt, to prompt your perceptions of what's behind it.

C: It is good that people are thinking about where their tea comes from and what its impact is on the environment and the people who are producing it.

NM: A growing number of people are. I would rather have a product that had a sustainable label than an organic label, or would have a fair-trade label.

C: I don't really understand that much about agriculture, so in traditional tea farming, how damaging is the type of fertilizer, say, and the use of pesticides, in the first place?

NM: Well, all things are relative, and tea is a monoculture, and people tend not to like monocultures because of bio-diversity issues. But on the other hand, it's better to have tea as a monoculture than an annual crop with fallow periods, because then you get a lot of land washed away by rain. Tea is in there for 100, 150 years. It's got a fabulous rich structure and the best way to grow tea is to keep mulching it, so you keep building up the organic material in the soil. So, on balance, tea is a very sustainable crop.

C: I would think that just the fact that it doesn't have to be replanted every year is a huge increase in efficient use of resources as far as agriculture goes.

NM: That's right. A good example of sustainability in tea is Unilever: a monolithic company who are hard-nosed, and yet they started a sustainable tea growing exercise in Kenya nearly twenty years ago, and they've gotten to the stage now where by 2015 every leaf of their tea will have an internationally-recognized label for sustainability.

C: That's impressive.

NM: I hesitate to promote what Unilever does, as an ex-employee having worked for them for 27 years, but what they've done in tea really has been fantastic, and other people are following. The other companies really are having to follow because Unilever buys nearly 30% of the world's exported tea, and they've said "every leaf we buy has got to have a Rainforest Alliance certification." That means that a lot of producers have got to jump, and they've got to get Rainforest Alliance certification.

C: Because everyone has to compete with the big guy.

NM: Right, and because if you want to sell to the big guy you've got to have the certification.

C: One thing that I think is important in the whole discussion is the difference between big scale tea production versus tiny, single -- not even single estates -- but small farms, like small production in China. The issues of organic farming and fair trade farming aren't the same, but the whole tea industry is talked about as if it's one huge thing, but the processes are totally different.

NM: Yes, absolutely different. In some countries you can see the two side by side. In Kenya you can, because you've got the big guys -- Finley and Unilever -- with huge acreage, and you've got the little guys with an acre of tea -- the Kenya smallholders -- and registered in a body there are 450,000 small farmers in Kenya. That's a lot of farmers.

C: That's farmers of any kind?

NM: No, not all, just small ones. I think the average in Kenya for a small farmer is half a hectare, which is an acre and a bit. That's the average, so there are some with ten acres, some with just a pocket handkerchief, but they still have to sell their tea somewhere. They sell it to their factory that they own by having a share in it, so the community owns their own factory; that is their investment. They get paid by the factory, and they get paid for every kilo of green tea leaf that they give into the factory, and at the end of the year they get a bonus payment which is based on how much the factory made at auction. If they plucked fine, and the factory processed well, then they get a bigger bonus. So they have a vested interest.

C: So there's incentive to put out a good product.

NM: So that factory is one of 60 in Kenya, small farm factories, and all the small factories are managed under the umbrella organization "Kenya Tea Development Agency." All the farmers, by having a share in the factory, and the factories having a share in the Agency, they all have an overall ownership.

C: Then how is it managed, by representatives?

NM: Yes, each region will have a representative in the zone, and each zone -- there are eleven zones -- will have an elected person who's the director on the main board, so it's a typical pyramid. There's corruption in that, inevitably, but it's been running since 1965. It's the best example in the world of small farmers empowered to compete with the big guys. Other countries tried to follow that route, but none were so successful. Some were catastrophically unsuccessful, Uganda being one example. Of course, they had bad political problems, and now they're pulling themselves out of that, and the small farmers are once again doing well, but on a much smaller scale.

C: I was really encouraged by what you were saying during the African tea tasting at the Expo about Rwanda, and the way the government is looking at development in the country.

NM: It's a benevolent dictatorship, effectively. It's probably the best form of government you can get. You get things done, and quickly, and they do them right.

C: Well, that's certainly a lot better than fairly recent times in Rwanda. It seems like they went through such a catastrophic political upheaval, big enough to get to a point where they said we're never going to let that happen again.

NM: Yes, what Germany went through too.

C: In the Kenya tea farms, where is most of the labor coming from, because the tea plucking season is not the whole year, is it?

NM: Yes it is. In Kenya they're on the equator. They have two wet seasons and the amount of leaf goes up then, and in the dry seasons the quality goes up, but they pluck all year round.

C: Is the labor that they're using in tea production mostly families?

NM: In the villages, mostly family labor, and the larger producers employ people from their community.

C: Are the tea farms competing with other agriculture in the same area?

NM: Yes, they are. In Kenya it's less so because people have established a sort of routine regular income from the tea. In Tanzania, which is the next country down, very much so, there's a choice of crop. People make that choice and at the moment tea is losing out. The actual competing crop is different in different areas. In the northeast it's spices that compete with tea. Down in the south it's bananas and vegetables. There's a much more ready market for those, and tea gets left unplucked, or not plucked as well as it should, so that quality goes down, and of course then the return goes down and that's a progressive thing. I was working on a project in Tanzania earlier this year, actually, to look at what the commercial possibility was of putting in extension service, to try and get people to understand that if you look after your tea then you will get a better return. Each country has a slightly different history, so you often get to the same point by a different route. In Tanzania they had a socialist, Marxist episode, so they had a lot of state-aided tea planting. They had large plots and people went in and they worked it, but there was no ownership, no pride of ownership, and when they became more liberalized, people shunned the collective farming because they wanted to grow their own, so a lot of that tea was abandoned. People grew their own so they had total control over that, of course. They make a choice: should I get money quick, by growing potatoes or bananas? Bananas are so simple to grow; they grow themselves. You just pull bananas off the tree: cut and they fall off into your hands. As people who are trained in the old-fashioned way [of growing and processing tea] are getting older the younger ones are coming in. Their sons are coming in, and they look at [the tea industry] and they say, “you know, I don't want to work in tea, plucking tea, when I can make money [faster] growing vegetables.”

C: They're looking at it as more of a short-term benefit?

NM: Pretty much so, and so there is a lot of tea that's been abandoned, and there are a lot of gaps in the bushes. The whole thing spirals downwards under those conditions.

C: I remember you talking about how taking over the land in a situation where a tea field has been left unworked is really unmanageable because pulling out the tea and replacing it with a different crop is really labor intensive. Are those tea fields recoverable for tea?

NM: Part of the work I was doing in Tanzania was to look at that and to see what the opportunity was of doing it. They do, to their credit, have a scheme [for recovering the tea fields that have been abandoned]. They've had a scheme there for about ten years, but it's been totally ineffective. It's not been organized properly. It's been done on a village scale, and the extension advice is very sparse, so they don't really do it very well. But we're looking at a way of coming in with organized planting teams, to come in and actually do it, and the farmers would pay.

C: Who would be coming in, what organization?

NM: I was working for a philanthropic organization. Philanthropic organizations in Africa got the idea that putting money in was like putting money in a hole in the ground ...

C: But putting in direct education and action is more effective?

NM: Exactly, so you would possibly do it by outsourcing it to a commercial operation, and then training the farmers in economics, and in husbandry.

C: The way that Utz was talking about their programs [during the forum at the Expo] it seems like they're much more focused on going in and helping the tea farmers learn how to run their businesses more effectively, rather than the more hands-off methods of Transfair.

NM: Yes, and that's good. There's a US organization called TechnoServe, and they do much the same thing. They concentrate much more on business management. African farmers have precious little understanding of business management. They're very smart about growing things, smart about seeing where a profit might come from, but in terms of profit and loss, and breaking even on investment, it's not the sort of thing they do.

C: If they're looking at getting the big official certifications the outlay of money is just tremendous.

NM: It is, but very often they'll group together. in the KTDA [Kenya Tea Development Agency], for instance, everyone owns their own factory, has a little share of the factory, and it will be the factory that gets the certification.

C: So they are able to gain certifications collectively which they would be unable to get as small individual farmers.

NM: A small contribution is taken out of their bonus, and then the factory can afford the $5000 a year, or whatever it costs.

C: So it does become affordable to them at that point, even though it's three-year gap between when they enter the program and when they're officially certified?

NM: Well they certainly haven't got any organic certification in Kenya. They've got fair trade, but no organic. The only really organic factories in Africa are the two in Tanzania. One is a factory called Luponde. That was the first organic factory, first organic estate, in Africa. They got certified in the '90s, I think, because they identified it as a good opportunity for marketing.

C: They were ahead of the curve enough to know?

NM: They saw what had to be done and they did it. Now the other factory went in for a totally different reason: Luponde's down in the south. Herculu, the other factory, is up in the north. It's an Indian-run factory. Luponde's parent company is Norwegian and Danish ownership. They come from sort of good ethical stock. The factory in the north is owned by Bombay Burma, and they've got organic factories in India. They went into organic in Tanzania because the cost of production is so high ... or the difference between the cost of production and the selling price is so small. They went into it so they could eliminate putting on chemical fertilizer.

C: Because they didn't want to have to pay for chemical fertilizer? That's interesting.

NM: I don't know of anyone else who went into organic for that reason.

[[to be continued]]