Due to the El Nino-inflicted drought that has plagued Indonesia in 2015 (curtailing output o agricultural commodities, the country's tea exports are expected to plunge by 40 percent year-on-year (y/y) to about 48,000 tons this year. The El Nino in 2015 is one of the strongest on record. This weather phenomenon, which occurs once every five years on average, involves periodical warm ocean water temperatures off the western coast of South America that can cause climatic changes across the Pacific Ocean, leading to severe droughts in key agricultural-producing countries in Southeast Asia.
According to data from the Indonesia Tea Council, Indonesia produced 120,000 tons of tea leaves in 2014, while exporting around 80,000 tons. However, data from the Food and Agriculture Organization of the United Nations put Indonesia's tea production figure at 146,682 metric tons in 2014.
Besides the El Nino-inflicted drought, Indonesian tea exports are also obstructed by tough import regulations - set by the European Union - limiting the amount of anthraquinone. The new maximum reside level (0.01 mg) of anthraquinone caused confusion as the Indonesian tea industry does have the testing equipment readily available. Furthermore, the cause of the high anthraquinone level found in Indonesian tea is uncertain. The chemical could occur due to the bleaching of pulp during paper production. Previously it was suspected that the use of insecticides could explain the high level of anthraquinone but the Indonesia Tea Council denies this.
The high level of anthraquinone found in Indonesian tea is a bottleneck that needs to be solved as soon as possible as it makes Indonesian tea less competitive compared to tea produced by Indonesia's main (tea-producing) rivals Sri Lanka and Vietnam. Most of Indonesian tea exports are shipped to Europe, the USA and the Middle East.