Rooibos price to rise 15%
Rooibos Limited says slower production and high demand is forcing costs upwards.
JOHANNESBURG - Rooibos Limited on Thursday announced that the producer price of rooibos tea will rise by 15 percent from January next year because of supply constraints and growing demand.
The company's Managing Director Martin Bergh says this is because the plant is expensive to grow reliably.
"There's a big disconnect between rooibos production and rooibos consumption. Rooibos in production is a semi-desert, dry-land plant so without irrigation, production fluctuates fairly dramatically while consumption is a fairly steady thing with a slow growth pattern."
He says production is currently lower than consumption, which is why the prices are rising.
Meanwhile, Bergh says the fight over the word 'rooibos' has calmed down.
Earlier this year, it emerged that a French company filed to have the name trademarked there, to the dismay of leaders in the South African industry.
"At the moment, I think we're in a good place. Through the Department of Trade and Industry, we've now got rooibos on the way to being registered under the Merchandise Marks Act which will open the way for us to approach the EU to get it recognised as a geographic indicator."
Rooibos would then become a name that can only be used to describe tea indigenous to the Cederberg region of the Western Cape.
"So, things are looking good at the moment," he says.