Navigating the ambiguous realm between premium and specialty tea

Unlike specialty coffee, which is distinctly defined by the Specialty Coffee Association (SCA) as achieving 80 points or higher on the coffee grading scale, the definition of specialty tea is far more illusive, especially when distinguishing it from premium tea. By Kathryn Brand

More scope and agency lie with both the farmer and the brands selling the tea to define the grade of the tea they produce or sell, whether that be specialty, premium, commodity, or the infinite distinctions in between. And this largely is centered around pricing; if the tea costs more to produce it needs to be priced higher and is therefore generally considered a higher grade tea, but there may also be a discrepancy between how the brand positions itself and the quality of the tea it is selling.

Premium and specialty tea, most would agree, is of an elevated quality, and the consumer will recognise this at the point of purchase by factors such as its price point, packaging (loose leaf, specialty tins, pyramid tea bags etc), origin information, sustainability credentials, or how and where it is sold. But the question remains, how much overlap is there between the two segments, and is there a way of distinguishing one from the other? Are there certain attributes only associated with specialty tea, for example? Without the clear distinction of coffee available, it is easy for the segments to blend into one another, or as Marco Sinram, head of tea trading and sustainability at Wollenhaupt commented, for the premium label to be a mere marketing tool rather than a differentiation from its commodity grade cohort.

Attempting to distinguish specialty and premium

Wollenhaupt, a wholesaler that also provides blending, flavouring and packaging services, operates across all grades of tea, commodity through premium and specialty. “We are catering, on the one hand side, to large industrial customers with very commercial qualities. And on the other hand, we are also supplying, to very specialised kinds of customers, high-end teas which can be called a real specialty rather than premium,” explained Sinram. Therefore, where Wollenhaupt crosses the spectrum of tea, it is in a unique position that necessitates dividing the tea it processes into segments, and translating somewhat arbitrary distinctions into something it can put a value against.

Sinram marked the distinction between specialty and premium as such; “Premium certainly is defined as high quality, but it can also be, for example, a blend of various types of tea or various origins of tea. Whereas the true specialty tea we would rather define as a single origin tea, or even to be more defined, which is located from a single tea estate, or even more specific in our case, which is being produced from a special type of tea plant cultivar.” He added further that it can also come down to the specific method of production that makes a tea unique, and therefore specialty. However, Sinram agrees there can be overlap between premium and specialty.

There is concurrence with Sinram’s perspective and that of Hälssen & Lyon, which trades, refines, blends, flavours and packages teas from the world’s leading tea-producing countries. The company’s spokesperson defined premium tea products as “orthodox produced whole leaf or broken Camellia sinensis products, as well as fruit or herbal products with visually appealing flowers and a wide range of high quality flavourings.” Whereas specialty tea comes “from specific regions or growing areas and is often inaccessible to the average consumer due to their limited availability and high price. In comparison, premium teas are much more accessible due to the unlimited variety of flavours that are available in each tea category.” The region where the tea is grown remains crucial in defining the category, as does the availability, which both drives the price and is a symptom of it.

Image: Wollenhaupt

Similarly, Sandra Nikolei, a member of Kloth & Köhnken’s (K&K) tea department/corporate social responsibility team, emphasised the production method, “specialty tea means it is a special tea, it was not produced a ‘normal’ way. The shape or the leaf size must be special, formed or like a Pai Mu Tan, just sun dried and not formed. [Whereas] Premium tea can be made by normal production but the taste must be special. The taste must be unique or extra ordinary.” K&K wholesales, blends and packages some of the world’s finest teas.

This suggests that, while the precise distinction can verge into the realm of vague, it is possible to pinpoint distinct and tangible attributes that separate specialty tea from premium, and indeed most importantly, set specialty on a level above that of premium. However, this viewpoint is not universal, and is not shared by all corners of the tea industry. Mark Donovan, head of botanicals, flavours & innovation at Tata Consumer, which includes five tea brands under its umbrella (teapigs, Tetley, Tata Tea, Good Earth, and Vitax), commented, “The term specialty tea is a construct of the industry. […] I would define specialty tea as any tea (whether leaf or fannings) that is not a straight black or green tea. Within all three sectors there is premium tea, which consumers equate to price point rather than actual quality or type of tea.”

Donovan’s point is reiterated by Bala Sarda, founder & CEO of Vahdam Tea. “Specialty teas encompass a broader category of teas that have been enhanced or infused with additional ingredients, flavours, or production techniques. These teas, also known as value-added teas, include blends incorporating herbs, spices, flowers, or fruits to create unique and innovative flavour combinations. Specialty teas may also encompass limited edition blends or signature blends developed for special occasions,” he noted.

Whereas premium teas, Sarda explained, “are defined by their exceptional quality and often command higher prices in the market. These teas are typically sourced from specific regions known for producing high-quality leaves, such as select invoices of first or second flush from renowned tea-growing regions like Assam and Darjeeling. Premium teas are prized for their distinct flavour profiles, aromas, and superior craftsmanship, making them sought after by tea connoisseurs who value excellence and authenticity.” In other words, how Hälssen & Lyon’s spokesperson, Sinram and Nikolei define specialty tea.

It is evident that even for actors within the tea supply chain, there is confusion and discordance about what exactly specialty tea is when compared to premium tea and whether they can even be distinguished from one another. However, both categories are distinct from commodity or mass produced tea and their origins and production reflect this.

Higher quality tea at origin

Premium and specialty teas are generally grown on smaller farms, with less land and therefore lower yields, not only due to the land size but also due to the very nature of the tea. “You cannot use every leaf. Mostly you use only two leaves and one bud or even less,” explained Nikolei, resulting in the cost of raw materials on a weight basis, being much higher, added Donovan. Further, such teas require gentle handling and additional training when being harvested, increasing the labour costs at the farms. “It’s more labour intense, because to maintain specialised types of tea plant cultivars, it definitely takes more time and labour to look after,” said Sinram. The quality requirements are just that much higher.

“Quality control stands as a paramount aspect, necessitating meticulous oversight at every stage of production. This involves not only the careful selection of tea leaves but also the implementation of precise processing techniques and stringent quality control measures to ensure consistency and excellence in the final product,” stated Sarda. And this quality control can also include adherence to certifications such as Fairtrade, Rainforest Alliance, or organic, which involves further cost from the producer, as well as specialised processing techniques to preserve the best flavours. It is a much more cost intensive process for the farmer, which they hope to offset by being able to charge a higher price.

And this is normally the case, with the cost being transferred along the supply chain and resulting in a higher priced tea at point of sale. This is a higher price in relation to commodity grade tea, however it can vary widely from only a little higher, to a lot higher, depending on the tea, and quite how premium or specialty it is, as well as how the company selling it chooses to market it.

Selling premium & specialty tea

It is becoming increasingly common to see higher quality or premium-grade tea in supermarkets and grocery stores, brands such as teapigs or certain ranges of Twining’s and Pukka, being the major UK ones. But in order to find the truly the most premium or specialty teas, Sinram said the number one place they are best sold is in dedicated tea shops.

Image: teapigs

“Some of the most outstanding quality teas we sell end up in specialised tea shops because you need to give the consumer who buys high quality tea, a specialty type of tea at a fancy price. [However,] you need to [offer] this consumer a lot of information, otherwise they will not accept the high price unless they understand the reason why the product [is so pricey],” said Sinram, adding, “and with the understanding and with knowledge, the consumer is more [willing] to pay a [high] price for such a product. And in my personal opinion, that works best in the shop where you have a face-to-face kind of experience between the knowledgeable shopkeeper and the consumer. I think this is still the best way to sell a specialty tea; either tea shop or specialty food shop.”

Sinram explained that the next best option for selling specialty or premium teas is online, where a lot of information about the teas can be provided; origin, background knowledge, special ways of preparation. There are myriad possibilities for brands to showcase this online, whether it be text, images, graphics or videos.

It is the additional information that is provided about premium and specialty teas that also sets them apart. In the same way as coffee, if a consumer is paying a higher price, they want more information for that price; they want to truly understand what it is they are paying the extra cost for and why. If one is to accept Sinram, Nikolei and Hälssen & Lyon’s spokesperson’s distinction of premium and specialty, whereby specialty tea is that step above premium and exceptionally contingent on specific regions and cultivars, it is in these tea shops where this kind of tea is best appreciated and sold, and the information supplied with it is essential.

The demand for quality

The appetite from consumers for higher quality teas is on the rise. “Based on Nielsen Market data, American consumers are showing declining demand for commodity grade teas and are more than willing to pay a little more to get a significantly better beverage experience,” revealed Darren Marshall, CEO of Smith Teamaker.

Vahdam Tea’s Sarda also noted an uptick in demand for higher quality tea, and credits this to consumers’ heightened interest in the nutritional value of the products they consume; “Higher quality teas, known for their rich antioxidants and other wellness-promoting properties, are becoming increasingly sought after by consumers seeking to enhance their overall well-being.” He also referenced the growing emphasis on origin and authenticity, and as a result the sustainability of such products, as well as the desire for indulgence and sensory pleasure which has prevailed, along with demand for wellness, since the Covid-19 pandemic.

While there may be growth in the premium segment, Sinram argued that for the especially high-end, or what he defines as specialty tea segment, there is some growth, but it is expected to remain a niche market. “I think it’s natural that these types of products will never be a mass type of market product.”

Nevertheless, there is some growth, and a reason for that, Sinram noted, is due to Western consumers, especially the younger demographic, being attracted by Asian culture, Asian food and Asian rituals. And this especially involves tea. Sinram said that they are “interested in preparation of high quality tea, the Asian way. Which is a very specific type of tea preparation compared to what we do in the UK, and what we do in Germany and so on. And it’s appealing to consumers.” Sinram added that specialised tea courses are becoming popular, where consumers can learn about tea production and especially preparation, much like is common in the wine segment with tastings and vineyard visits.

This knowledge is so much more readily available to consumers with the dominance of the internet and social media. Rituals and expert preparation techniques can be learnt freely and readily across the world. Highly premium and specialty tea is something, as Sinram noted, that is still a niche market in the Western world. However, this is not the case in specialty tea-producing countries such as China, Japan and Taiwan. He explained that the “main ratio of their production, and specifically also the high quality part of their production, is tending to remain in country for internal consumption,” because the demand as well as understanding and knowledge for high quality teas is so much higher and consumers are willing to spend a lot more money for such teas. So, a lot of highly premium and specialty teas are not being exported to reach the Western market as there is such a good internal requirement.

Yet with the desire for knowledge surrounding specialty and premium teas in consuming countries growing, it will not be surprising to begin to hear more calls for a universal definition of specialty tea, as in the specialty coffee world. If large players in the tea industry remain ambiguous and even discordant on how to differentiate and articulate tea quality, then how can consumers be expected to fully engage with and understand the information companies give them about their premium or specialty teas, or make informed decisions about their purchases? An accepted definition would be useful and would help clarify the difference between premium and specialty tea in the eyes of consumers, as well as bringing the specialty tea world up to the lofty success of specialty coffee.

• Kathryn Brand is an associate editor on T&CTJ, while still writing for several of Bell’s other magazines. She joined Bell Publishing at the beginning of 2022 after graduating from the University of East Anglia with a degree in English Literature and Creative Writing. She may be reached at: [email protected].

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