Business Report Economy

Ntingwe wins over tea buffs in UK

Published

Durban - A small tea estate tucked into hills above KwaZulu-Natal's Tugela River has made such an impression on British tea buffs that it has already brewed a market for the 1750 tons-a-year of tea it plans to produce within 12 years.

Although its output is just a fraction of South Africa's total, Ntingwe Tea Estate, set up and funded by the Ithala Development Finance Corporation, has taken the international tea market by storm with its specially-packaged hybrid beverages.

It has also been the catalyst for development in an area riddled with socio-economic problems: joblessness of about 60 percent, high rates of illiteracy, a dwindling population of adult males and an explosion of children under the age of 18.

Although South Africa is a net importer of tea, Ntingwe has aimed its product almost exclusively at the export market to attract better earnings. Its principal buyer is Taylors of Harrogate, through which the product is sold under the Ntingwe brand name in metal caddies.

Ntingwe's tea processing facility is expected to produce 393 tons of black tea this year, generating up to R6 million in income. The estate's output represents just two percent of South Africa's total production, the bulk of which is sourced from the Industrial Development Corporation's Limpopo-based Sapekoe Estates.

The volumes may be small, but Ntingwe's impact has been substantial, in particular on its neighbouring communities. The estate has helped to secure electricity and communications infrastructure and, more recently, a R10 million water project for the area.

Ryle Perera, the managing director of Ntingwe, says the tea estate operates to the world's highest standards, and is helping to cultivate a community of specialist tea growers.

It currently employs 650 workers, mostly women, and in addition sources tea leaves from about 10 outgrowers in the area.

Ntingwe was initiated as a development project to help alleviate unemployment. The area's high rainfall and acidic soil had in the late 1960s been identified as ideal for tea-growing, but the project got off the ground only in the early 1990s.

At the peak of production in about 2014/15, Ithala, which has a social responsibility mandate from the KwaZulu-Natal government, will have invested R67 million in Ntingwe, and employment levels will have risen to about 1500, with 250 hectares of outgrower blocks on the outskirts of the estate.

The venture is roughly half complete, but Ntingwe's extensive nursery area provides a glimpse of what is to come as the estate further expands output for eager overseas markets.

"In the UK, there is big demand for quality tea. We have serviced that market and made quite a success of it," says Perera.

He says Ithala is keen to attract equity partners in Ntingwe and, once the investment is complete, the estate will "eventually be privatised in some form".

For the moment, there has been no interest: an agricultural venture geared around the world's cheapest beverage that continues to clock up investment costs is simply not lucrative enough to attract buyers.

But Perera, a third generation tea-grower from Sri Lanka, believes Ntingwe will enable the surrounding communities to reap the rewards of tea for decades to come, as the tea bush lasts in the ground for about 100 years.

"I always tell people: 'This tea is not only for you but for your children's children, so look after it.'"