North America Tea Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

North America Tea Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

The North American tea market is projected to register a CAGR of 3.1% during the forecast period (2021 - 2027).

The herbal tea segment is expected to pose significant growth over the coming years. The present situation in terms of the COVID-19 outbreak has paved a strong ground for herbal tea manufacturers, as consumers are actively seeking products that are good for health and nature and act as an immunity booster in the North American region, thus driving the market further.

Owing to the strong consumer preference in United States, the market is witnessing steady growth, albeit Canada has been lUnited Kingdomewarm in its response. Both countries have slashed prices, leading to an increase in tea sales (by volume) in North America. Consumption of tea in the North American region is not limited by seasonality but is always steady, irrespective of time.

Canadians have become aware of the health benefits associated with tea consumption and the wide variety of tea offerings, which drove the demand for tea during the forecast period.

Tea consumption in North America is driven by consumer’s search for new non-alcoholic beverages over fruit juices and carbonated drinks. ​Consumers are developing an affinity for tea due to its bag version, which offers enhanced convenience, thus, providing a suitable, convenient, and healthy alternative to juices and carbonates. Healthy hydration refers to the ability of tea to provide instant refreshment and mild stimulating benefits that are not considered detrimental, which is otherwise the case with coffee and other energy drinks. ​The organoleptic versatility associated with tea makes it open to manufacturers to innovate alongside the healthy trends that have been resonating more prominently in the North American market. ​

The linkage between tea and its healthful properties, such as organic and others, remains fundamentally strong in the North American market. The tea market is propelled due to its health-promoting profile and the variety of herbal variants, new pack sizes, and organic options in North America. ​

United States has been identified as the third-largest importer of tea globally. Tea consumption in United States has increased significantly in the past few years, and tea is now the most popular beverage in this country. In this region, the major growth opportunities include increasing health awareness among North American consumers, the introduction of new flavors, and the demand for convenience.

In United States, the tea market is primarily driven by the health advantages associated with tea consumption and a rise in public knowledge of carbonated beverages. Furthermore, an increase in disposable income, a shift in disposable income, a shift in people's tastes, and the introduction of new healthful components in tea by various market participants, among other things, all contribute to market expansion.

The North American tea market is highly competitive, with regional and global players capturing a significant share in the market. Some of the few companies, which have emerged as the leading players are ITO EN INC., Davids Tea Inc., Hain Celestial Group, Tata Consumer Products, Unilever, and Associated British Foods PLC​. These players have focused on leveraging opportunities posed by emerging markets to expand their product portfolio, further expanding their market share. Companies compete on different factors, including product offerings, quality, taste, flavors, price, functionality, size, packaging, and marketing/branding activities, in order to gain a competitive advantage in the market.​

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