Consumer brands group AVI, the owner of household names such as Five Roses and Freshpak rooibos tea, says its rooibos input cost spiked 27% thanks to a local drought in 2017/18.
With better rainfall last year, most product prices stabilised somewhat but it seems not rooibos. The same box of 80 teabags still costs R54.
The price climbed steadily from R29 for a box of 80 tea bags to over R50.
MD at Rooibos Ltd, Martin Bergh says rooibos is a medium-term agricultural crop meaning it only yields two years after planting.
We had a serious drought for four years so there was a lack of the total yield of the plantations.— Martin Bergh, MD - Rooibos Ltd
We don't know how long the lack will be...— Martin Bergh, MD - Rooibos Ltd
We've had a real shortage for three years and this year the crop will meet the total demand so prices to farmers are in the process of dropping and that is going into the market place as we speak.— Martin Bergh, MD - Rooibos Ltd
According to Bergh, as soon as the brands get through the expensive stock the prices might start stabilising and that could be sometime during the year.
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This article first appeared on CapeTalk : Why rooibos tea price remains high despite improved rains