So let’s look at the real wholesale prices for Longjing tea, at least the first tea of the year, which is the most prized. This is the tea that is harvested before the Qing Ming Festival, which usually falls in the first week of April.
As in everything in China, prices being paid are bent, one way or the other, by the closeness of the relationship between buyer and seller. A relationship in China can only be developed by personal interaction, over a long period of time. Confucius established the social complications of the buyer and seller 2500 years ago in China, just as the Greeks established the theories of government and law for the western world. So when we start to talk about prices, relationships are important things to keep in mind – and the hardest thing for Americans to understand. The foundation of business practice in China is based on a completely different cultural basis. The prices that I am talking about in this article are the average prices paid by buyers in strong relationships with their sellers; those with weak relationships will pay more, and very close relationships may pay less. This is true all across China, but for the purposes of this article, I will just be focusing on Hangzhou, the home of Longjing.
Seven Cups found that wholesale prices had not dropped when we bought tea this year. I was there before the tea harvest had begun and heard rumors that the price might drop, not from tea people, but from a government-connected banker. When I subsequently asked tea people, they all said the rumors were ill-founded. They talked about how costs had risen, especially after the record high temperatures last summer, which required abnormally heavy irrigation to prevent damage to the valuable bushes. Weng Sunqin, the daughter of 85-year-old Weng Shangyi, told me that for twenty days straight they stretched out a hose to their seven mu gardens and sprayed water from 4:00 PM until 9:00 AM the next morning. In addition to the price of water going up – so does everything else – from electricity to labor, every year.
I wanted to get up-to-date information about prices as I wrote this, so I spoke to Zhang Liying, one of the tea scholars at the Chinese Tea Culture Research Institute. She also owns a very small, exclusive tea shop, and teaches tea culture classes. Not only does the institute compile a broad range of data about Chinese tea in general, but because the institute is in Hangzhou, Longjing is a tea that all of the scholars are particularly aware of. I also talked to Weng Sunqin, a producer and member of one of the 150 families that provide the best tea from Lion Mountain, which includes Weng Jia Shan (Weng Family Mountain), named after her family.
I also spoke to Mary Lou Heiss, because her company was named in the World Tea News article, and asked her if she had paid a lower price for the Longjing she recently imported. She told me that the price she paid was very similar, maybe a tiny bit higher than last year, and expressed the opinion that Longjing prices have been very stable the last couple of years. She also told me that she had not been contacted or interviewed for the story.
The Longjing growing area in Hangzhou is very small and is divided into three general areas. The highest wholesale price is paid for tea from Weng Jia Shan, named Shifeng Longjing. The average price this year was 3500 RMB per jin for the traditional cultivar that existed before the Mao era. For the Longjing #43 cultivar the price was 2500 RMB per jin (A jin is 500 grams, a little bit more than a pound). For Mei Jia Wu tea, from that area was 2800 RMB per Jin (A dollar is 6.18 RMB so 3500 RMB would be $566.72).
Outside of the tea growing areas listed above, the largest growing area in the general Hangzhou region is located in a place called Funying. The price of the best Funying tea is around 1500 RMB. It is very likely that if you are a tourist, or an unknowing buyer, this is the tea that you will be offered in places like Longjing or Mei Jia Wu villages. The best Fumying Longjing is good enough to be acceptable to most buyers. I have had a lot of very expensive tea from the West Lake area tea houses that was not as good as the best Funying Longjing. Of course, tea sold as Longjing can come as far away as Sichuan to be sold in Hangzhou.
I want to impress upon people that all of the authentic Longjing tea gets sold every year without fail, or exception. Producers establish the price the market will bear, with an eye toward keeping customers. This requires them to raise prices when they do based on cost. Longjing should have been more expensive than it was this year, just because of the expensive summer last year, which was exceptional. If it happens again this year, it will go up next year, and it will be reasonably understood in the Chinese market.
With the limited production area and the vast market for Longjing, it is a safe bet that the price will not go down. It is basic economics. Losing a big customer like government officials buying with government money is not big enough to make a dent in Longjing prices. It also doesn’t mean that they will stop buying Longjing as a gift; it only makes Longjing a more meaningful gift when the person receiving it thinks it came from the giver’s pocket. I am sure that the restricted officials will find a way to work the system, as evidenced by our own government system, where no matter what the regulation, officials find a way to make things work for their benefit.
For the consumers interested in getting authentic tea, it will continue to be hard. Most people aren’t obsessive about getting the real thing. Who can blame them?, Even mediocre Chinese tea is pretty good, and if you like the tea you get, so what? Nobody drinks really good, authentic champagne and eats French Truffles everyday. I drink tea every day, and could drink the real thing, but I don’t. Some things need to remain special.
Neither the Chinese or American press knew the Chinese tea market well enough to realize that this story was blatantly false. The tea community needs good information, especially when it affects an important market negatively. Nobody wants to be asked by their customers why your price has not fallen by a third, as reported by the World Tea News, because the editorial staff is not knowledgeable enough to spot an article that was so recognizably wrong. This kind of reporting can have a negative effect on the market. Maybe it’s meaningless because few people care, or are paying attention, which is usually the case.
Part one of the tale of Longjing pricing can be found here.
Images courtesy of the contributor.
Austin Hodge is the founder of sevencups.com.