Tea Processing Plant

Report Overview: 

IMARC Group’s report, titled “Tea Processing Plant Project Report 2025: Industry Trends, Plant Setup, Machinery, Raw Materials, Investment Opportunities, Cost and Revenue,” provides a complete roadmap for setting up a tea processing plant. It covers a comprehensive market overview to micro-level information such as unit operations involved, raw material requirements, utility requirements, infrastructure requirements, machinery and technology requirements, manpower requirements, packaging requirements, transportation requirements, etc. The tea processing project report provides detailed insights into project economics, including capital investments, project funding, operating expenses, income and expenditure projections, fixed costs vs. variable costs, direct and indirect costs, expected ROI and net present value (NPV), profit and loss account, financial analysis, etc.

What is Tea?

Tea is a beverage made from processed leaves of Camellia sinensis with bioactive compounds including polyphenols (predominantly catechins), caffeine, and theanine. These are responsible for its antioxidant, anti-inflammatory, and stimulant activities. The tea varieties—green, black, oolong—vary in terms of levels of oxidation during processing, which affects their chemical content and health impacts.

Tea Processing Plant: Key Highlights

• End-use Industries: Food And Beverages, Pharmaceuticals, and Cosmetics and Personal Care
• Applications: Used as a beverage for human consumption

A tea processing plant is a facility that is used to transform freshly harvested Camellia sinensis leaves into different forms of edible tea using a series of chemical and physical processes. Based on the type of tea (green, black, oolong, or otherwise), the factory can have machinery for withering, rolling, oxidation (or fermentation), drying, grading, and packaging. Major elements of the plant usually include troughs or drying beds, rotorvanes or rollers, fermentation chambers, fluid bed dryers or ovens, and sorting machines. Maintaining the exact temperature, humidity, and oxidation levels is important to achieve flavor and quality. Such facilities also must abide by strict food safety and hygiene standards. Tea processing facilities supply various industries such as beverage firms, hospitality, health products, and ready-to-drink tea companies.

Tea Industry Outlook 2025:

Among the major drivers of the tea market globally is increasing consumer health awareness leading to a demand for natural, antioxidant-based drinks such as tea. Tea is comprised of bioactive compounds like catechins, theaflavins, and polyphenols that have been proven scientifically to be beneficial to health, decreasing heart disease risk, assisting in digestion, enhancing brain functioning, and aiding weight control. It has been steadily increasing, according to the United Nations Food and Agriculture Organization (FAO), global tea consumption has risen by 3.3% each year, totaling 6.5 Million Tons in 2022 over the last ten years. It has also been noted by the World Health Organization (WHO) that healthy diets, such as those including plant-based beverages, play a role in preventing noncommunicable diseases, further supporting the health positioning of tea. Moreover, shifting consumer preferences towards clean-label, functional drinks and the worldwide movement for sustainable agriculture have driven demand for organic and specialty teas, including green tea, herbal infusions, and matcha. According to the U.S. Department of Agriculture (USDA), in the United States, more than 80% of the population consumes tea, and ready-to-drink (RTD) tea sales have been growing through convenience and health appeal. Likewise, in India and China, two of the world's largest producers and consumers of tea, urbanization and lifestyle changes have contributed to an increased consumption of tea among socioeconomic groups. The versatility of tea, increasing popularity of healthy products, and backing from dietary guidelines for plant-based beverages remain major contributors to the global market expansion of tea.

Tea Market Trends and Growth Drivers:

Increased Health Consciousness and Demand for Function Drinks

A primary force influencing the international tea market is consumers' increasing trend toward healthier drink options, fueled by increasing awareness of the health advantages of drinking tea. Green, herbal, and specialty teas are generally well known for their antioxidant, anti-inflammatory, and soothing qualities, leading to better heart health, digestion, and immunity. With the World Health Organization (WHO) estimating that noncommunicable diseases (NCDs) account for nearly 74% of global deaths, preventive healthcare has become a priority, boosting demand for functional drinks like tea. According to the U.S. Department of Agriculture, tea is the second most consumed beverage globally after water, with over 5 billion cups consumed daily by 2024. Additionally, trends like clean-label and plant-based eating are driving demand for herbal infusions, organic, and sugar-free. Such a shift in consumption on the part of consumers due to health considerations is reflected in increasing tea innovation like ready-to-drink (RTD) wellness teas, matcha lattes, CBD-infused tea, and immunity boosters, which are popularizing in markets like North America, Europe, and part of Asia. Market leaders such as Unilever, Tata Consumer Products, and The Republic of Tea are investing more in functional product portfolios to target health-conscious consumers.

Premiumization and Specialty and Artisanal Tea Growth

Yet another key force in the tea sector is the growing consumer trend towards premium and specialty teas owing to changing palates, increased disposable incomes, and a wider appreciation of the cultural and sensory aspects of tea. As urban consumers increasingly demand more experiential and personalized food and beverage offerings, there has been increased demand for loose-leaf, single-origin, organic, hand-plucked, and rare varietals such as Oolong, Darjeeling first flush, White tea, and Pu-erh. Such premiumization is further driven by the emergence of boutique tea lounges, specialty online stores, and luxury gifting formats that focus on provenance, terroir, brewing methods, and depth of flavor. As per the Tea Board of India, Darjeeling tea contributes only 87 registered gardens yielding around 8 million kilograms a year yet fetches global premium prices because of its GI-tagged distinctness. Also, eco-friendly consumers will pay extra for ethically sourced and certified teas (Rainforest Alliance, Fair Trade), which again fuels top-line growth in the higher market segments. This is driving incumbent brands and niche players alike to diversify portfolios, innovate in packaging format, and invest in origin- and authenticity-driven storytelling.

Latest Industry Developments:

• May 2025: Lipton introduced new products along with a revamped logo and packaging, marking the company's biggest brand change in over ten years.
• January 2025: TreeHouse Foods, Inc. announced that it has successfully paid about $205 million to acquire Harris Tea. Through improved blending and sourcing capabilities, this calculated step fortifies TreeHouse's tea portfolio.
• December 2024: Supreme, a vape manufacturer based in Manchester, paid £10.2 million (US$ 12.9 million) to acquire Typhoo Tea out of administration. Typhoo Tea, the UK's first pre-packaged tea brand, was founded in 1903 and went into administration in November 2024 as a result of declining sales and mounting debt.

Leading Tea Manufacturers:

Leading manufacturers in the global tea industry include several multinational companies with extensive production capacities and diverse application portfolios. Key players include

• Associated British Foods PLC
• Barry's Tea
• Bigelow Tea
• Caraway Tea
• Dabur Ltd
• LIPTON Teas and Infusions B.V.
• TAETEA Group Co., Ltd
• Dilmah Ceylon Tea Company PLC
• Tata Consumer Products Limited (Tata Group)

all of which operate large-scale facilities and serve end-use sectors such as food and beverages, pharmaceuticals, and cosmetics and personal care.

Tea Plant Setup Requirements

Detailed Process Flow:

The processing process is a multi-step operation that involves several unit operations, material handling, and quality checks. Below are the main stages involved in the tea processing process flow:

• Unit Operations Involved
• Mass Balance and Raw Material Requirements
• Quality Assurance Criteria
• Technical Tests

Key Considerations for Establishing a Tea Processing Plant:

Setting up a tea processing plant requires evaluating several key factors, including technological requirements and quality assurance. Some of the critical considerations include:

• Site Selection: The location must offer easy access to key raw materials such as tea leaves, herbs, spices, and other additives. Proximity to target markets will help minimize distribution costs. The site must have robust infrastructure, including reliable transportation, utilities, and waste management systems. Compliance with local zoning laws and environmental regulations must also be ensured.​
• Plant Layout Optimization: The layout should be optimized to enhance workflow efficiency, safety, and minimize material handling. Separate areas for raw material storage, production, quality control, and finished goods storage must be designated. Space for future expansion should be incorporated to accommodate business growth.​
• Equipment Selection: High-quality, corrosion-resistant machinery tailored for tea processing must be selected. Essential equipment withering troughs, rolling machines, CTC machines, fermentation chambers, dryers, sorting and grading machines, blending machines and packaging machinery. All machinery must comply with industry standards for safety, efficiency, and reliability.​
• Raw Material Sourcing: Reliable suppliers must be secured for raw materials like tea leaves, herbs, spices, and other additives to ensure consistent production quality. Minimizing transportation costs by selecting nearby suppliers is essential. Sustainability and supply chain risks must be assessed, and long-term contracts should be negotiated to stabilize pricing and ensure a steady supply.
• Safety and Environmental Compliance: Safety protocols must be implemented throughout the processing process of tea. Advanced monitoring systems should be installed to detect leaks or deviations in the process. Effluent treatment systems are necessary to minimize environmental impact and ensure compliance with emission standards.​
• Quality Assurance Systems: A comprehensive quality control system should be established throughout production. Analytical instruments must be used to monitor product concentration, purity, and stability. Documentation for traceability and regulatory compliance must be maintained.

Project Economics:

​Establishing and operating a tea processing plant involves various cost components, including:​

• Capital Investment: The total capital investment depends on plant capacity, technology, and location. This investment covers land acquisition, site preparation, and necessary infrastructure.
• Equipment Costs: Equipment costs, such as those for withering troughs, rolling machines, CTC machines, fermentation chambers, dryers, sorting and grading machines, blending machines and packaging machinery, represent a significant portion of capital expenditure. The scale of production and automation level will determine the total cost of machinery.​
• Raw Material Expenses: Raw materials, including tea leaves, herbs, spices, and other additives, are a major part of operating costs. Long-term contracts with reliable suppliers will help mitigate price volatility and ensure a consistent supply of materials.​
• Infrastructure and Utilities: Costs associated with land acquisition, construction, and utilities (electricity, water, steam) must be considered in the financial plan.
• Operational Costs: Ongoing expenses for labor, maintenance, quality control, and environmental compliance must be accounted for. Optimizing processes and providing staff training can help control these operational costs.​
• Financial Planning: A detailed financial analysis, including income projections, expenditures, and break-even points, must be conducted. This analysis aids in securing funding and formulating a clear financial strategy. 

Capital Expenditure (CapEx) and Operational Expenditure (OpEx) Analysis:

Capital Investment (CapEx): Machinery costs account for the largest portion of the total capital expenditure. The cost of land and site development, including charges for land registration, boundary development, and other related expenses, forms a substantial part of the overall investment. This allocation ensures a solid foundation for safe and efficient plant operations.

Operating Expenditure (OpEx): In the first year of operations, the operating cost for the tea processing plant is projected to be significant, covering raw materials, utilities, depreciation, taxes, packing, transportation, and repairs and maintenance. By the fifth year, the total operational cost is expected to increase substantially due to factors such as inflation, market fluctuations, and potential rises in the cost of key materials. Additional factors, including supply chain disruptions, rising consumer demand, and shifts in the global economy, are expected to contribute to this increase.

Capital Expenditure Breakdown:

Operational Expenditure Breakdown:

Profitability Analysis:

Report Coverage:

Report Customization

While we have aimed to create an all-encompassing tea processing plant project report, we acknowledge that individual stakeholders may have unique demands. Thus, we offer customized report options that cater to your specific requirements. Our consultants are available to discuss your business requirements, and we can tailor the report's scope accordingly. Some of the common customizations that we are frequently requested to make by our clients include:

• The report can be customized based on the location (country/region) of your plant.
• The plant’s capacity can be customized based on your requirements.
• Plant machinery and costs can be customized based on your requirements.
• Any additions to the current scope can also be provided based on your requirements.

Why Buy IMARC Reports?

• The insights provided in our reports enable stakeholders to make informed business decisions by assessing the feasibility of a business venture.
• Our extensive network of consultants, raw material suppliers, machinery suppliers and subject matter experts spans over 100+ countries across North America, Europe, Asia Pacific, South America, Africa, and the Middle East.
• Our cost modeling team can assist you in understanding the most complex materials. With domain experts across numerous categories, we can assist you in determining how sensitive each component of the cost model is and how it can affect the final cost and prices.
• We keep a constant track of land costs, construction costs, utility costs, and labor costs across 100+ countries and update them regularly.
• Our client base consists of over 3000 organizations, including prominent corporations, governments, and institutions, who rely on us as their trusted business partners. Our clientele varies from small and start-up businesses to Fortune 500 companies.
• Our strong in-house team of engineers, statisticians, modeling experts, chartered accountants, architects, etc. has played a crucial role in constructing, expanding, and optimizing sustainable Processing plants worldwide.