Revival of Japanese Tea Industry

IN view of the impregnable ho ld the I n d i a n and Ceylonese teas

have on the w o r l d market today, Japan's role in the beg inn ing of the present century as an impor t an t pro­ducer and an exporter has faded out . In Japan, as in Ch ina , tea was used in the beginning as a medicine and it is only in course of t ime that it became a nat ional beverage. A legend and a religious ceremony have grown around tea and the customs and manners of tea d r i n k ­ing are ha l lowed by their aura.

The Japanese have made tea in to a rel igion and " Teaism is a cult founded on the worship of the beaut i ful . . . . I t is re flected in their (Japanese) porcelain, lacquer, pa in t ­ing, l i tera ture . . . . Teaism represents much of the art of Japanese l i te . The Chinese tea clubs made no such

demands upon the potter and the artist, as d i d similar gather ing in J a p a n : ' (W H. Ukers: All About Tea.)

A l t h o u g h tea has the flavour of re l igion for the Japanese people, it has been relegated to a subsidiary posit ion in the country 's agr icu l tu­ral economy. Tea is very often i n -terplanted w i t h mulberries and plums. The p lan ta t ion is done on the lower slopes of the hi l ls , t hough it has not been unsuccessful even on the level plains, provided drainage is adequate. '[ 'he famous Uji tea gardens are chiefly located on the plains and cu l t i va t ion is carr ied on there under an ar t i f ic ia l shade, the result being a h igh qual i ty tea of a dark green colour,, chiefly g rown for home consumpt ion . P ick ing of leaves commences at the end of t h i r d or four th year after p lan t ing , the wel l - renowned Japans being pluc.k-ed f rom the e ighth to the f if teenth year. T h e normal life of a bush is twenty-five years. There are usually three pickings in a year and some­times a f o u r t h one, w h i c h yields only poor qua l i ty leaves.

A m o n g the p r inc ipa l tea producers of the w o r l d , Japan occupied, dur ­ing the pre-war years, a posi t ion next to Ch ina , I n d i a , Ceylon and Netherlands East Indies. H e r aver­age p roduc t ion of tea in 1935-39 amoun ted to 114.4 m i l l i o n lbs, the b u l k of i t compr is ing green tea. In 1041 w h e n her o u t p u t was at the peak level of 136.5 m i l l i o n lbs. Japan's share in w o r l d p roduc t ion (exc lud ing C h i n a for w h i c h f igure ' are not avai lable) was 12 per cent.

Product ion declined d u r i n g the war-vears. touch ing the lowest ever re­corded figure of 47.2 m i l l i o n lbs in 1946). In the post-war per iod , h o w ­ever, tea ou tpu t began to move up and r e a c h e d 77.4 m i l l i o n lbs in 1950. D u r i n g January-July 1951 it was 03.2 m i l l i o n lbs.

Japanese tea may be classified into lour k inds :

( i ) Hikacha or Yencha , a h igh qua l i ty powdered tea used on ceremonial occasions;

( i i ) Green tea, subdivided in to Gyokuro and Sencha, the latter, though infer ior to the former in qua l i ty , account ing lo r the bulk of home con­sumpt ion ;

( h i ) Bencha. an admix tu re of previous season's leaves and wi thered stalks and chopped twigs ; and

( i v ) Black tea. Japan's con t r i bu t ion to the w o r l d tea supply is in respect of green tea w h i c h , f rom the early Years of the present century to the outbreak of the Second W o r l d W a r , had a great hold upon the popular taste in the A m e r i c a n Con t inen t and indeed, certain grades of Japans enjoyed a long-standing repu ta t ion abroad.

In spite of Japan being the p r i n ­c ipal producer of green tea, the g rowing impor tance of black tea in the overseas markets has been brought home to Japanese producers as a result of increasing black tea. imports in to the U S A in preference to green tea. T h e Japanese Cove rn -inent and pr iva te enterprise have been g iv ing encouragement ever since 1933 tor the manufacture of black tea in order to compete w i t h supplies f rom other South-East Asian countries. F r o m the negl i ­gible o u t p u t in the ' twenties, Japan increased her black tea manufac­ture to a tenth of her tota l tea pro­duc t ion in 1937. D u r i n g the war-years, p roduc t ion of black tea d w i n d l e d o w i n g to the loss of her foreign markets and to her being a consumer of green tea. It was resum­ed at the end of the w a r and f r o m 2 per cent in 1948, it went up to 6 per cent of to ta l tea p r o d u c t i o n in 1950. T h e accompanying table w i l l indicate the g r o w i n g impor tance of black tea manufac ture in Japan.

It is believed that good blacks can be manufac tu red f r o m Japanese leaves, if the same is fo l lowed as in C h i n a where a very f u l l fermenta-

t ion takes place in the leaves. A l l varieties of tea come f r o m the same p lant , bu t have a different taste as a result of the chemical t rea tment given to the leaves after p luck ing . If the leaves are fermented, they tu rn to black tea; i f unfermented , the result, is green tea. An autho­r i ty on the chemistry of tea observes; '' At Shizuoka, I saw a small factory where they were mak ing black tea in the same style as in I n d i a , i.e., w i t h a definite period d u r i n g w h i c h the rol led leaf was pu t in a cool place to f e rmen t before it was f ired. I believe the black tea thus made was not a success, perhaps because of low temperatures. W h e n the temperature gets below 70 F in Darjeel ing, it is found tha t the fer­menta t ion takes so long tha t the tea is not good. However , I see no reason w h y Japan black tea should not be as good as China black tea, if manufac tured in the Ch ina wav . " ( C . R . H a r l e r quoted b y W . H . Ukers op c i t ) .

No doubt . Japan t r i ed to increase her exports in the pre-war pe r iod , but her home consumpt ion had been steadily increasing. The per capita consumpt ion of tea in the pre-war years was estimated at less than a l b ; by 1940 it had gone up to 1.3 lbs. D u r i n g the early war-years there is every reason to suppose, tha t the i n ­ternal consumpt ion was greatly i n ­creasing as indicated by the ever-w i d e n i n g gap between the f igures of p roduc t i on and exports, t h o u g h the increase in p o p u l a t i o n has again b rought d o w n the per capita con­sumpt ion to less than a p o u n d in .the post-war per iod .

T h e export of Japanese tea on a commerc ia l scale began in the lat ter ha l f of the nineteenth century w h e n i t was bartered for calico and other products . D u e pa r t l y to the d i rec t ocean l i n k w i t h A m e r i c a and p a r t l y to the A m e r i c a n preference for green

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February 16, 1952 THE E C O N O M I C W E E K L Y

K. Murti

T H E E C O N O M I C W E E K L Y February 16, 1952

tea, the U S A was, f r o m the beg in ­n i n g , the best customer of Japan . T o w a r d s the end of the last cen­t u r y , the US offtake of Japanese tea represented near ly h a l f of her tea impor t s . T h e Japanese exports ex­panded f r o m the beg inn ing o f the present cen tury to the end of the F i r s t W o r l d W a r , the annua l ship­m e n t averaging 50 m i l l i o n lbs d u r ­i n g 1914-18. T h e U S A h a d her first taste of b lack tea d u r i n g the F i r s t W o r l d W a r a n d as a result of the vigorous p ropaganda for I n d i a n tea i n t ha t coun t ry , impor t s o f Ja­panese tea d r o p p e d to 17 m i l l i o n lbs on an average in the decade 1919-1928. To revive her expor t t rade , J a p a n C e n t r a l T e a Associat ion launched in 1926 a five-year tea adver t i s ing c a m p a i g n i n the U S A w i t h good results. Expor t s shot up to 30 m i l l i o n lbs in 1932, a n d steadi­l y increased to 52 m i l l i o n lbs i n J939- Japan was one of the f o u r l ead ing exporters i n 1939, a l o n g w i t h I n d i a , C e y l o n and Ne the r ­lands East Indies . At the end of the war , J apan increased her exports , w h i c h a m o u n t e d to 16 m i l l i o n lbs i n 1950—the highest recorded i n any year i n the post -war p e r i o d . T h e share of exports to t o t a l p r o d u c t i o n was a fifth in 1950 as compared w i t h a t e n t h in 1942 a n d a t h i r d d u r i n g 1935-39.

Expor t s of Japanese blacks began w i t h a negl ig ible q u a n t i t y in 1933 a n d reached the record f igure o f 14.2 m i l l i o n lbs in 1937. T h e y de­c l ined af terwards, no shipments t a k i n g place in 1948 a n d 1949. E x ­ports were resumed in 1950, a n d a m o u n t e d to a t o t a l of 1.3 m i l l i o n lbs d u r i n g the year.

T h e U S A has always been the best cus tomer fo r Japanese tea. T h e expor t o f Japanese tea t o t he U S A to ta l l ed 4 m i l l i o n lbs in 1949 a n d w e n t up in the f o l l o w i n g year by a m i l l i o n lbs, a s compared w i t h an annua l average of 13.5 m i l l i o n lbs in 1937 a n d 1938. A l g e r i a a n d T u n i s i a w i t h a combined off take of 6 m i l l i o n lbs, M o r o c c o w i t h 2 m i l l i o n lbs a n d C a n a d a w i t h near ly a m i l l i o n lbs were o ther p r i n c i p a l markets fo r Japanese tea in 1950. T h e U n i t e d K i n g d o m was never a n i m p o r t a n t m a r k e t for green tea a n d hence Japanese tea d i d no t f igure p r o m i n e n t l y there. I t was, however , repor ted qu i t e recently, t ha t the Japanese black tea was in offer in the U K marke t for the f i r s t t i m e since the Second W o r l d W a r , i n d i c a t i n g a b i d by Japan to compete w i t h other blacks i n the U K marke t , es­pecial ly w h e n she is able to sell at really compe t i t i ve prices.

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THE ECONOMIC WEEKLY

N o r t h Borneo " In British North Borneo there are 350,000 people on an area

one-third the size of Britain, but the Colonial Office will not admit Indian and Chinese labour for fear of creating ' another Malaya'. And the Indian Government itself is unwilling to permit indentured emi­gration, and imposes a ban on emigration to most of the areas that would welcome immigration"—W. Arthur Lewis, A Policy for Colo­nial Agriculture.

TH E Co lony o f N o r t h Borneo, whose Governmen t requested

the Government of I n d i a recently to pe rmi t the emig ra t ion of 10,000 I n d i a n families for permanent set­t lement there, is the least k n o w n and least developed of the remain­i n g Br i t i sh terr i tories in South-East Asia, viz. , M a l a y a , Singapore, Sara­wak, Brune i and N o r t h Borneo. Be­fore the war , the (Colony was a Br i t i sh protectorate adminis tered by a Char te red Company . I t was only in 1946 tha t i t became a C r o w n Colony and the U K assumed d i rec t responsibili ty for its governance. Labour , w h i c h fo rmed a p a r t of the Straits Settlements before the war , is now incorpora ted in the Colony of N o r t h Borneo.

T h e present popu la t ion of the Co lony is est imated at 360,000, of w h i c h less t han 20 per cent, i.e., about 70,000, are Chinese and the rest mostly nat ive tribes, the most i m p o r t a n t being the Dusuns, w h o are" prosperous agriculturists . T h e n , there are the head -hun t ing Muruts, w h o fo l low the pract ice of shi f t ing c u l t i v a t i o n , and the sea-faring Ba-jaus. T h e Chinese f o r m the largest a l ien race and are engaged in c u l t i ­va t ion of small holdings, trade and commerce, skil led occupations and government service. T h e rest of the p o p u l a t i o n consists of the small , bu t power fu l , European c o m m u n i t y , a few Indonesians, Malays and I n ­dians. T h e count ry is very t h i n l y popula ted , the highest density being 23 persons to the square mi l e in the West Coast, where about h a l f the p o p u l a t i o n lives.

No estimate of the present I n d i a n popu la t ion in N o r t h Borneo is ava i l ­able. I t was less than 1500 at the census of 1931. T h e Colony's an­nua l repor t for 1949 ment ioned tha t " a few Ind ians , o r ig ina l ly employ­ed in the constabulary, have fo rmed small settlements and many of these have become da i ry farmers in the v i c i n i t y of the p r i n c i p a l towns " .

Economic Resources

T h e i m p o r t a n t p r i m a r y products of N o r t h Borneo are rubber , copra , m a n i l a hemp, tobacco, r ice, sago and t imber . W i t h the except ion o f rice, the others are expor ted , rubber

and copra be ing the largest revenue producers. Coffee, tapioca, maize, g roundnuts , bananas, .soya bean, sugar cane and various types of fruits and vegetables are also g r o w n for local consumpt ion .

O u t of the to ta l area of 19 m i l l i o n acres, the acreage, cleared and c u l ­t iva ted is about 1 ½ per cent. T h e acreage under rice is about 90,000; under rubber about 125,000; under coconuts about 40,000 and under sago about 14,000.

T h e to ta l p r o d u c t i o n o f rice i n 1949-50 season was 35,000 tons, w h i c h was sufficient for four-f i f ths o f the popu la t ion . In the 1950-51 season, however, the y i e ld was only 25,000 tons o w i n g to the late a r r i v a l of rains.

The. booming w o r l d prices fo r p r ima ry products has s t imula ted p roduc t i on and exports of rubber and copra. Rubbe r exports i n ­creased f r o m 19,500 tons in 1949 to 24,000 tons in 1950 and amoun t ­ed to about 21,000 tons in 1951. Expor ts of copra increased f r o m 19,000 tons in 1949 to 31,700 tons in 1950. Product ion of t imber du r ­i n g 1950 amoun ted to 6,237,558 cubic feet of w h i c h 3,750,507 cubic feet were expor ted .

T h e p r i nc ipa l impor ts in to the Colony arc textiles and apparel , provisions, rice, sugar, c iga r ' a n d cigarettes and vehicles. The t o t a l value of exports increased f r o m $ M 3 8 m i l l i o n i n 1949 t o $ M 9 2 m i l l i o n in 1950, and of to t a l impor t s f r o m $ M 3 4 m i l l i o n t o $ M 4 6 m i l ­l ion . ( $ M 1 = 2 sh. 4d . = Re. 1-

9-0)-T h e prosper i ty since the K o r e a n

w a r has been d i e to increased re­venue f r o m the h igh prices ob ta ined fo r rubber. T h e . to ta l government revenue increased f r o m $ M 1 1 m i l ­l i o n i n 1949 t o $ M 1 6 mi l l i ons i n 1950. O f the lat ter , $ M 1 1 m i l l i o n was f r o m customs a n d $ M 1 m i l ­l i o n f r o m in te rna l revenue ( I n c o m e -tax, C o m p a n y tax, licences, e t c . ) . T h e revenue surplus o f $ M 7 m i l ­l i o n was ut i l i sed for recons t ruc t ion a n d development , i n a d d i t i o n t o grants- in-aid o f $ M 3.8 m i l l i o n f r o m the U K Government ( m a i n l y w a r damage compensa t ion) .

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February 16, 1952

I he re-emergence of C h i n a as a p roduce r and exporter o f lea w i l l , no doubt , a f fec t Japan's trade in the green tea consuming countries. In fact , Japan has been fac ing a stiff c o m p e t i t i o n f r o m C h i n a i n the N o r t h a n d West A f r i c a n markets where C h i n a greens are preferred to the Japanese because of the i r lower pr ice . Nevertheless, at no t ime in the last ten or eleven years, has the Japanese tea indust ry been placed in such a favourable posi t ion as it is today.

T h e prospects of w o r l d tea p ro ­d u c t i o n exceeding the d e m a n d in the near fu ture , i f they material ise, are l ike ly to place I n d i a and Ceylon in a pred icament since, it is believed, the cost of p r o d u c t i o n in these' countries is on the. increase and q u a l i t y i s on the decline. I f Japan increases her serviceable black tea manufac tu re at a lower cost, as she has been do ing , she w i l l have a better marke t , p rov ided her supplies are regular and larger. India ' s posi­t i o n as the largest tea expor ter of the w o r l d w i l l not, however, be affected to any appreciable extent . Japanese compe t i t i on w i l l not be acute. Japan is h a v i n g less than a t e n t h of India ' s acreage under tea a n d her p r o d u c t i o n of tea, even in the peak pe r iod , was on ly about a f o u r t h o f the I n d i a n ou tpu t . Fu r ­ther p r o d u c t i o n of black tea in J apan is not l ikely to reach such a m a g n i t u d e as to threaten India ' s h o l d in fore ign markets. Never the­less, i f I n d i a is to m a i n t a i n her h o l d on a i l her t r a d i t i o n a l markets, she mus t offer on ly good qua l i ty tea at a reasonable pr ice.