Winding through India’s Mirik Valley on the western flanks of the Darjeeling hills, past Chamong, Spring Valley, and Gopaldhara tea estates, and before cutting through Okayti and Thurbo, the road runs along the eastern India-Nepal border. On a foggy, drizzly July day, with mist hanging between the tall pine trees and upturned, white flowers shaped like old gramophone speakers along the weedy edge of the tarmac, messages from Vodafone India arrived on the mobile phone (“Hello, have a pleasant stay in Nepal”) followed by ones from NCELL, the local Nepalese carrier. Tea estates spread along both sides of the road.
Although the first saplings planted in Nepal were said to be a gift to the prime minister, Jung Bahadur Rana, from the Chinese emperor in 1842, the industry developed with stock, not to mention expertise, from Darjeeling. In 1982, King Birendra declared five eastern regions a “tea zone.” Ilam Tea Estate—the first commercial estate, planted out in 1863—remains the best. Overall, Nepal’s 142 estates produced about 18 million kilograms (40 million pounds) of tea in 2012, roughly twice as much as Darjeeling. But only 2.4 million kilograms of that—some 13 percent—is orthodox. The rest is CTC. While nearly all of the CTC is consumed in Nepal, 96 percent of the orthodox is exported.20
The quality of Nepalese tea has been improving in recent years and carries similar taste and aroma profiles. Buyers and tasters have taken notice. “It’s always in the back of the minds of producers,” said Anindyo Choudhury of Darjeeling’s growers after the 2013 season had ended, “that they will get into their market.” Since then there has been a sudden awakening to the likelihood of this soon happening, and the issue has moved to the front of their minds. They are suddenly seeing it as one of their biggest challenges.
German and other European blenders have already begun marketing a “Himalayan tea” made with Nepalese leaves21 that cost a third of what Darjeeling does. Perhaps of greater concern for Darjeeling gardens are domestic packeteers buying for the national market. They are looking for value for money. If the quality is there and the price is right, many are not that concerned about on which side of the border the tea was produced.
In the future, Nepal could be even more of a threat. In ten years, Nepal’s National Tea and Coffee Development Board expects to expand plantings significantly and produce 45 million kilograms (100 million pounds) of tea with 30 million kilograms of that Darjeeling-style orthodox, some fifteen times as much as is now produced.
Climate changes, labor problems, and severe political instability have all contributed to significant reductions in Darjeeling’s output. Darjeeling once produced 16 to 17 million kilograms (35 to 37 million pounds) of tea, and as recently as 1991 reached 14.5 million kilograms. The 2010 crop, hit by drought and then excessive rain, cutting the first flush by 25 percent, didn’t even reach 8 million kilograms, the lowest since the 1950s. The 2011 harvest edged back up slightly with better conditions, but then 2012 got off to a terrible start, with droughtlike conditions and yields down a massive 40 percent. The 2013 harvest also began poorly. Tea bushes need three or four inches of rain between October and March. But no rain fell from the previous October until a sprinkling wetted the tea bushes in February, causing the first flush to be delayed. During April, the peak of the sought-after first flush, the harvest was down 24 percent from the previous year. The 2014 harvest began even worse. The lack of rain in the spring, with a more than two-month-long dry spell that lasted into May, pushed the first flush down 30 to 40 percent below 2013’s harvest. Some gardens lost even more, depending on the microclimate of the valley of the garden. “Gopaldhara [in the Mirik Valley] was down 33 percent, but Rohini [running up from the plains to Kurseong] was down 50 percent,” said Rishi Saria, “and that from last year, which wasn’t too good.”
First and second flush fetch good prices at auction. Together, they account for a third of the year’s crop but about half its revenue. The monsoon season contributes around 60 percent of the year’s total production, but much of this is sold below production costs. Autumn flush makes up the remainder.
That leaves little room for the kind of climatic unpredictability that stalks estates. In 2012, a hailstorm hit Marybong the first week of April and devastated its valuable first flush harvest. The same happened to Castleton in 2013, with a bruising of hailstones that knocked the quality of its highly coveted second flush.22
The heavy monsoons that drenched most of Darjeeling’s valleys during 2013 coupled with the summer political instability pushed down prices for the rainy-season teas by as much as 50 percent at J. Thomas & Co.’s auctions in Kolkata.23 Then the cold came early and the 2013 season wrapped up suddenly, quicker than expected. Most gardens missed their year-end targets.
Giving production declines an even deeper impact on profits is the recent leap in nonlabor input expenses. Sandeep Mukherjee puts them at 30 percent in a single year. Part comes from the significant increase in energy costs—electricity rates, coal prices, generator fuel—that jumped 15 percent between 2012 and 2013. Transportation costs shot up accordingly. Nearly everything in Darjeeling either comes from or goes down to the plains below. And now irrigation, which had not been prevalent in Darjeeling, is raising costs further.
Profit margins are thin. Today, a garden in Darjeeling is lucky if it is profitable. Final accounting numbers are known only by the highest levels of the head office and are rarely shared, but in the opinion of one owner with a number of gardens, the majority of Darjeeling estates are breaking even or losing money. Many are already in deep trouble. Soon-to-rise labor expenses will likely push more into the red in the upcoming seasons. Whereas a Rs 100,000 (about $1,800) per-hectare profit might be a round goal, he would be surprised if any garden is currently reaching that and figures a handful of well-managed groups might be making Rs 25,000 to Rs 50,000 ($450 to $900) per hectare. That isn’t much. The average garden is cultivating just 224 hectares of tea. Larger companies with holdings beyond their Darjeeling gardens are better able to absorb losses, but a few more years of such dire numbers will spell doom for many of the family-held estates.
While production costs rise and output declines, lower-quality counterfeit “Darjeeling tea” from Nepal and elsewhere undermines its reputation and cuts both value and sales even further. Ecological predictions for the future of the Darjeeling hills could hardly be more dire. As one local government survey summed up, with the mounting problems and strain on its natural resources, “The future of the Darjeeling hills does not look very bright.”24 The report was referring to the land itself and landslides, but when looking at these major challenges, it may as well have been speaking about the entire tea industry.
Sitting in his office beside the Planters’ Club, Mukherjee went even further in a flight of pessimism—or realism: “In twenty-five to thirty years, Darjeeling tea may vanish.”
* Even Jungpana is not immune to labor issues. During the 2014 monsoon flush, the owners took the unprecedented step of temporarily suspending all work operations along with pay and rations. They cited intimidation and threats from union officials interfering with managerial decisions. Tactics included gharaoing, a protest method of surrounding someone with a large group of people—often for many hours—until demands are met. It took two weeks and three rounds of meetings to negotiate the garden’s reopening.
† As there is no plucking on Sundays, a seven-day round is actually six plucking days.