GCC Countries Tea Market Size

In 2016, the tea market in the GCC was equal to 1.57 billion USD. Until 2020, it grew at a compound annual growth rate (CAGR) of 4.13% per year to reach 1.85 billion USD.

a bar chart that shows the tea market value in the GCC countries in the period 2016-2020

In 2020, the market was dominated by Saudi Arabia and the United Arab Emirates. They accounted for 41.0% and 40.2% of the total value. They were followed by Kuwait (7.7%), Qatar (5.4%), Oman (3.5%), and Bahrain (2.2%).

a bar chart that shows the market share of the tea market for each of the GCC countries in 2020

Most of the GCC countries are among the top tea-drinking countries in the world. People in the United Arab Emirates consumed by far the most tea in the GCC with 4.73 kilograms per capita in 2020.

a bar chart that shows the consumption per capita of tea in the GCC countries for each country in 2020

GCC Countries Tea Market Trends

Tea in Middle Eastern Culture

Tea is a crucial part of Middle Eastern culture and millions of people throughout the region consume the hot beverage daily. Tea is also a symbol of hospitality for locals as they serve it to welcome guests.

Black tea is by far the most popular type of tea in the Middle East. Locals brew it very strong and serve it hot with plenty of sugar or honey.

There are also many herbal teas that people in the region enjoy for their health benefits. Some of the most common herbal teas in the region and their health benefits include:

  • Sage tea has a calming effect on the body and people use it to help with digestion.
  • Thyme tea improves digestion and relieves respiratory problems.
  • Chamomile tea helps to relax and improves sleep.
  • Hibiscus tea lowers blood pressure and helps with digestion.
  • Mint tea has a refreshing effect on the body and aids digestion.

Each region in the Middle East has its own unique blends and preparations. Thus, the specific herbs and ingredients can vary based on local customs and traditions.

Health Benefits of Tea Promote Consumption

A major driver of the tea market in the Middle East are the health benefits related with its consumption.

Tea contains beneficial bioactive components, such as polyphenols, alkaloids, and antioxidants. Its consumption can also regulate digestion processes, supply slow-release sugar, reduce blood pressure, as well as affect uptake and metabolism of fats. In a daily diet, tea can help to prevent obesity, diabetes, and cardiovascular diseases.

Furthermore, the increased knowledge of the positive effect of bioactive compounds in teas will likely further propel growth of the tea market in the GCC countries. As a result, new tea products that contain additional vitamins, dietary fiber, and antioxidants will continue to grow more popular.

Sugar Taxes May Benefit Tea

To stimulate a shift away from sugar-sweetened drinks several GCC countries introduced a sugar tax in recent years.

In 2017, the Saudi government introduced a 50% excise tax on carbonated soft drinks and a 100% tax on energy drinks. The same year, the United Arab Emirates also implemented a 50% excise tax on sugary beverages. In 2019, Oman followed with its own 50% excise tax on sugar-sweetened beverages.

As more Arabs learn about the risks of sugary beverages, they will replace them in favor of other soft drinks. Thus, as consumption of sugar-sweetened beverages decreases, tea will likely fill in the gap.

Rise in Diabetes and Obesity

Diabetes and obesity are two of the fastest growing health threats in Saudi Arabia. According to the International Diabetes Association, in 2021, diabetes cases rose to an estimated 4.2 million in Saudi Arabia, an increase of nearly 55% between 2011-2021.

People with diabetes are prone to develop cardiovascular diseases, a major health threat in Saudi Arabia. All patients with diabetes should avoid sugar and refined starches, including white bread and white flour as they cause blood sugar spikes.

A meta-analysis of several studies found that green tea consumption decreases fasting glucose and A1C levels among people with diabetes. Scientists believe that catechins in green tea are responsible for its anti-inflammatory and anti-cancer properties. Moreover, tea reduces the risk of developing Parkinson's disease.

In regards to obesity, according to the Kingdom of Saudi Arabia World Health Survey, as of 2019 more than 38% of the adult population was overweight, while around 20% was obese. Furthermore, obesity increases the risk of developing type 2 diabetes in men and women.

Organic Farming Will Define the Future of Tea

As consumers become more interested in the origin of the food and beverages they consume, more of them will shift to organic products.

The UAE and Saudi Arabia are the leaders in the region’s organic food sector. Together they account for more than 80% of the region’s overall health and wellness market.

Moreover, the United Arab Emirates hosts the only Organic Tea & Coffee expo in the Middle East. The Middle East Organic and Natural Expo Dubai gathers organic product manufacturers from around the region. Presenters can showcase their products to interested buyers for further distribution throughout the MENA region.

In addition, successful business strategies account for the development of organic agriculture. Its purpose is to restore ecological balance through the use of natural products instead of harmful fertilizers, pesticides, and hormones. Moreover, chemical- and pesticide-free cultivation grows tea with better flavor.