Western Brands are Very Different from Big Factory Tea

  • The data from this original post was originally taken from puer.cn, and isn’t totally complete (it’s probably missing some productions). The information is intended as a proxy to look at some trends. Here’s the dataset of White2Tea, Yunnan Sourcing, Dayi, and Xiaguan. Dayi and Xiaguan we looked at 2004-2006 and 2014-2016. For W2T/YS we just looked at 2014-2016.

It’s no secret that the pu’erh market has changed a lot. Old factories like Dayi and Xiaguan have remained mainstays, but are pretty different entities than they were 30 or 40 years ago. Boutiques and more recently westward facing vendors have popped up. Some have pressed long enough to fall into certain patterns for what they offer, i.e. vendor X sells tea as Wuliang every year. As we’ve examined in what western vendors put into their inventory, boutique western facing vendors don’t necessarily offer a balanced selection of pu’erh. So are these big Chinese vendors offering the same sort of tea as we see places like Yunnan Sourcing or White2Tea are? Not exactly.

Who is Buying & Why?

In the western pu’erh scene we get exposed to a whole lot of raw pu’erh, but the selection tends to be heavily skewed towards young pu’erh. There’s also a bias towards drinkability. A substantive chunk of the western audience is buying pu’erh (both raw and ripe) for their own, often immediate consumption.. Big factories, like Dayi or Xiaguan, have a different audience. Their recently produced raw pu’erh probably isn’t consumed young very often, making it a fairly different animal than the young pu’erh western vendors sell. While there is the occasional western hobbyist who buys boutique tea by the tong and sells them down the road, big factory tea has a far easier to determine resale value and can be purchased by the jian(s) as a vehicle for investment/speculation.

  • On the topic of speculation. Factory raw pu’erh from earlier eras has obviously appreciated quite a lot. You can debate how much ripe pu’erh improves with time. But what about price appreciation for known productions? A quick glance at Dayi Shu prices from the 1990s or early 2000s, and there’s no denying that the price for both raw and ripe productions has increased.
Xiaguan Tuos
A pair of 2004 Xiaguan Tuos.

Ripe Pu’erh tend to be a Big Factory (& Bigger Production) Game

Because of how it is processed, ripe pu’erh is usually done in huge batches. The smaller vendor (includes all western vendors) who wants to sell ripe pu’erh under their own label, either needs to rewrap an existing production or buy different grades of tea from dealers or factories or buy a share of a batch. It’s a lot easier to do private label raw pu’erh, where the vendor can go to the farmer and buy as little as a few kilos and press it.

The data reflects this, and while White2Tea and Yunnan Sourcing are some of the few western vendors who do actually have ripe pu’erh under their own labels — it still makes up a pretty small total amount of their total productions, 24 out of 161 productions or about 15%. This fits into the stereotypical western vendor business model of offering a wider range of young raw and a very small selection of other pu’erh categories (i.e. semi-aged, ripe). Compare that with the 2014-2016 Dayi/XG where 126 out of 366 or 34.4% are ripe.

On the subject of production size in raw vs. ripe… Yunnan Sourcing sometimes lists their production sizes. Their ripe productions tend to be much larger (i.e. the 2015 Year of the Goat was made with 300kg of material) whereas the raw productions trend smaller (typically 30-80kg, i.e. 2017 Manzhuan or 2017 Daxueshan). This fits with our understanding of how ripe pu’erh is acquired and sold.

Big Factories Produce More Ripe Tea Than Boutiques

# Teas % Raw % Ripe
2004-2006 Dayi + XG 265 72.60% 27.40%
2014-2016 Dayi + XG 366 65.60% 34.40%
2014-2016 YS + W2T 160 85.00% 15.00%

Fact or Fiction? Xiaguan Presses Sheng Cha & Dayi Presses Shu Cha w/a Little bit of Sheng Cha

Dayi is associated with ripe tea. It has a long history with shu cha dating back to its creation, with then Dayi employee, Zou Bingliang acting as one of the principal parties in coming up with the controlled fermentation process. Many of the famous recipes are Dayi creations, 7572, 8592, 7262, etc. Xiaguan has also pressed ripe tea for many years, but is more known for their raw pu’erh.

Indeed, Dayi does press a lot of shu. Slightly under 40% (71 out of 181) of teas made in 2004-2006 were ripe pu’erh, and ~61% of teas (84 out of 138) made from 2014-2016 were ripe. 18 were numbered recipes compared with 33 from 2004-2006, perhaps indicating an emphasis on special productions or “higher quality” teas, that can be sold as scarcer, more premium vehicles of speculation. This is also a fairly balanced approach in terms of a ripe/raw balance. Dayi has made classic raw pu’erh teas and there’s no indication that they’ve really slowed down in producing raw pu’erh either.

The more extreme change in ripe production has occurred with Xiaguan. From 2004-2006 there were a grand total of two ripe pu’erh teas in our dataset. I suspect that we’re probably missing some productions here, but that is a stark contrast with the 82 raw pu’erh teas in the dataset from 2004-2006. In the same period, Dayi had 71 ripe pu’erh teas. In more recent years Xiaguan has been a bit more balanced, pressing ~19% ripe tea from 2014-2016.

Dayi Presses More Ripe than Xiaguan

# Teas % Ripe
% Numbered Ripe Recipes
Dayi 2004-2006 181 39.20% 18.23%
Dayi 2014-2016 138 60.87% 13.04%
Xiaguan 2004-2006 84 2.38%
Xiaguan 2014-2016 230 18.69%

18 responses to “Western Brands are Very Different from Big Factory Tea”

  1. I don’t have any links, but I’m fairly certain that Scott has mentioned before that they have some teas that haven’t been released yet from past year, and the same from W2T. If they want to offer aged or semi aged raw under their own label, they either have to reward like you said, or wait a number of years before releasing their older productions.

    The hole in their puer offerings now, might not be as big in the future when some of the teas they’ve stored up are finally released.

  2. Hi James & Denny,
    I feel that the above data can be interpreted like this:
    The increase in shu production has mirrored both the popularity of puerh in general as well as the increase in the cost of puerh over these years. The increase in factory shu productions, I believe, are due to two considerations that influence purchasing in China and Asia.
    1- The traditional belief that sheng puerh is not healthy to consume until it is aged. This coupled with the fast, instant gratification, “I want it now” mentality of the internet age has added to the increase in shu productions which is reportedly better for health and can be consumed immediately. Sheng puerh’s popularity has driven people to shu for the mere fact that they can consume immediately without detriment to their health.
    2- It would be interesting to see data sets that look at the increase in puerh production vs increase in shu offerings. I think shu puerh productions are usually (but not always) less expensive than sheng productions. People want to buy into the popularity of puerh but don’t want to shell out more money to do that. As the price of puerh continues to increase this might price people out of the sheng market and into the shu market.

    For the Western puerh vendors, I see them pressing more and more shu puerh as the years go on mainly because of the second point. None of the Western vendors were doing shu 8-10 years ago. Sheng puerh drinkers are being priced out of sheng and forced to move into shu. Also, people new to puerh, and have no history or taste for or loyalty to sheng and can enter the puerh market at a lower price point. White2tea is very very smart for offering increased shu selection year to year.
    For this reason, I bet that the Western Puerh vendors will be releasing much more shu puerh in the years to come.
    Thanks again for starting this discussion.

    • Hello Matt,

      Good points with regards to the increasing cost becoming more of a factor. In my opinion I feel rising cost is acceptable if the quality of the tea rises alongside with it. I don’t feel that has been the case (generally speaking when you look at the big picture and don’t just focus on the top 1 percent) and so that creates a problem. I believe the over harvesting of tea, commercial farming practices have been affecting the quality of raw materials for some time now. If this isn’t already apparent now then it will become starker in future years. The process of shu pretty much can cover this up, and the quality issue becomes less apparent to see. Just my thoughts.

      Thanks James for another great article and allowing for these kinds of exchanges to happen. Also really appreciate the reviews and work both you and Denny did/do and so now I need to work on the next educational series 🙂


      • Varat,

        * the increase in puerh PRICE vs increase in shu offerings

        Thanks for catching that.

        It is also my understanding that processing can cover up quality issues but I don’t know enough about the processing to state that this is the case.

        Much Peace

  3. Cool piece!

    Is there any data on the production of gift tea?

    The government has a quota for teas made for consumption in minority areas as a dietary component.

    There was a big initiative a few years ago on puercn for marketing ripe in the west, in part a solution for excess tonnage of plantation tea. An article I read in 2014 mentioned excess tonnage still left from 2008!

  4. I’ll provide some insight into our productions.

    Yunnan Sourcing Brand Ripes are usually produced in the hundreds of kilograms quantities so overall in a given year they could constitute as much as 1/2 of the tea we produce in terms of overall kilograms.

    Given that all of our Yunnan Sourcing Brand Pu-erhs must pass a 191 pesticide profile (and be within EU limits for those 191 pesticides) that makes it quite difficult to have smaller ripe productions and a great variety. It is much much harder to find a ripe pu-erh tea that can pass the 191 profile test. This is because ripe pu-erh tea batches typically come from many many different growers. Even if farmer 1 through 8 doesn’t use pesticides and farmer 9 uses too much then it won’t pass pesticide profile and we won’t be able to make it. So… when we do find a nice clean ripe pu-erh batch we tend to buy alot and use over the course of a few years, perhaps in several ripe productions.

    It’s much easier to find compliant raw pu-erh from small family and village gardens! Working with one grower year after allows for more transparency and clear expectations regarding pesticide use. When dealing with ripe pu-erh there is a lack of transparency since we don’t know or have a relationship with myriad growers who tea leaves made their way into that wet piling. In 2017, we tested 8 batches of ripe tea that we liked and only 2 passed. It’s very frustrating but we remain committed to sourcing safe ripe pu-erhs!

    • The big tea companies do the opposite. They mix more than 20 or 30 teas in one blend to pass the tests. It’s a pesticide cocktail then, but they keep the amount of one specific pesticide relatively low.

      Hope you’ll test all of your tea in future and include more pesticides in the test. But I think you’re doing a very good job already!

  5. I wonder if also the “de facto” assumption in the market that an increase in age leads to an increase in price market may lead some producers to continue to focus on the production of sheng over shu to support their ongoing concerns, however this may be mediated somewhat by storage costs and other costs, as Scott has pointed out .

    I think also its right that lesser quality can be hidden in the depths of shu productions and hence also encourages some producers to focus on sheng as increased exposure to poor or mediocre shu leads to a market “turn-off” as well as the demand for . However as we are all acutely aware some crazy things can occur in the Puerh market and I cite the early Menghai V93 productions that still attract ridiculous prices for sheng material, could this be a reason why they have refocussed their production of shu (post 2014)??

    I think Scott’s comments gives a lot of insight into this.

    • For the Chinese market at large (at this point in time) I think it’s just market factors responding to demand. Ripe Pu-erh is quite popular and is more widely consumed in China than Raw Pu-erh. The consumers of Pu-erh in China (both ripe and raw) have become increasingly discriminating, so I don’t think that producers in China will do well to sell inferior Raws or Ripes. Of coure, being such a huge market there are always some noobs who will end up paying their study fees by buying crap.

      • I think the market trends within China is definitely something to be considered – hence the V93 phenomena where early shu exceeds the price of sheng equivalents due to internal demand.

        I am always curious how fake and forged cakes fit into this whole debate as is there a market pressure there that influences some of the bigger productions in regard to future releases??

  6. Just to clarify:
    The average prices I am finding for the 2006 Dayi V93 Sheng 100g Tuo Cha is around $60. The prices for the shu equivalent exceeds this, if you are lucky enough to find one or persuade someone to sell you one!

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