Tea

China's tea production and distribution were under the control of the imperial government during the Song dynasty (960–1279). Ming dynasty (1368–1644) revenue objectives were far less ambitious, for the Ming state largely limited its involvement to the overland tea exchange with Inner Asia, where Chinese tea was bartered for nomadic horses. Officials ran a network of tea-horse trading stations along the northwest frontiers with Mongolia and Tibet to curb smuggling and enforce an export monopoly. By the late Ming dynasty in the sixteenth century, this system had disintegrated, replaced by virtually unregulated private trade. The successor Qing dynasty (1644–1911) controlled Inner Asia and its pasturelands, and had little need to revive the tea-horse trade.

During the Qing dynasty, the tea trade with Mongolia and Tibet was dominated by well-organized Chinese caravan traders. Brick or compressed tea, portable and long-lasting, became so important in Inner Asian economies that it was used as a form of currency. During the early nineteenth century, a caravan trader exported increasing amounts of tea to Russia. From the mid-1800s, Russian firms gained direct marketing power over this overland commerce by buying, processing, and shipping brick tea and other types of tea from central China—a situation which prevailed until the Russian Revolution of 1917.

EARLY GROWTH OF THE MARITIME TEA TRADE

In the 1750s the Qing dynasty, concerned with security but desiring limited trade contracts with Europe, confined Western trade to the major port of Canton (Guangzhou) on China's southern coast. Further restrictions were imposed on foreign merchants under what came to be known as the Canton System. One major restriction was that all commerce had to take place only with a group of state-licensed Chinese traders (the Cohong). This monopolistic arrangement allowed for mutually profitable commerce until the early nineteenth century. Trade on the European side was dominated by exclusive trading organizations, the East India companies, which were chartered joint-stock enterprises and early versions of modern multinational capitalist corporations. Two famous examples were the English East India Company (founded in 1600) and its long-time rival the Dutch East Indies Company (established in 1602). Granted official monopolies of trade between their home countries and southern and eastern Asia, the companies set up numerous coastal trading stations (or factories) in those regions.

The mid-eighteenth century saw the English East India Company eclipsing all the others, and controlling a triangular trade between India (which it in fact conquered and ruled until the mid-1800s), China, and the United Kingdom. Tea, silver, and eventually opium came to be the most important commodities in this complex exchange.

Tea drinking was a novelty in Europe in the seventeenth century, but the demand for tea rose dramatically in the 1700s. This was especially so in Great Britain, whose legal tea imports doubled in a generation (to 4,728,000 pounds in 1750). Extremely high customs duties levied by the British government, as well as the East India Company's monopoly pricing of tea imports, contributed to the rapid growth of tea smuggling, which ceased when British tea taxes were reduced from 119 percent to 12.5 percent per pound by Parliament in 1787. Across the Atlantic Ocean, tea taxation had already become a contentious issue in the onset of the American Revolution. When Parliament in 1773 extended the East India Company's monopoly of tea exports and distribution to England's American colonies, the measure (along with the tea taxes themselves) sparked widespread protests and popular violence. This is best symbolized by the destruction of some 10,000 pounds sterling worth of tea in the Boston Tea Party of December 16, 1773. Britain's immediate response was punitive, and the repressive measures taken then against both Boston and Massachusetts provoked a lasting break with the American colonies.

The mercantilist economic logic of the time held that the export of gold or silver specie or bullion was a last resort in settling international trade deficits. This posed particular problems in the China trade. Since Chinese demand for European goods was quite limited, and China's tea, silk, and porcelain (china) exports to the West mounted in the seventeenth and eighteenth centuries, silver steadily flowed to China. This "silver drain" problem, as it was generally considered in the West, was finally solved by China's own rising opium importation in the early nineteenth century. From 1729 this narcotic drug had been officially banned time and again by Qing authorities, yet opium exports from India became an essential means of financing the English East India Company's annual tea exports from Canton. The trade was done indirectly through private foreign merchants operating under East India Company licenses, so as not to jeopardize the Company's legitimate commerce at Canton. China's domestic demand for opium grew in tandem with the expansion of Sino-foreign trade, leading to a reverse silver drain from China. That issue, as well as the Qing Empire's efforts to halt opium imports, eventually resulted in the Opium War with Great Britain in 1839 to 1842. China's humbling defeat insured that opium imports would continue, while its own tea exports rapidly expanded over the second half of the nineteenth century.

EXPANDED EXPORTS AND GLOBAL COMPETITION

After 1842 five Chinese treaty ports were opened to foreign trade and residence, and dozens more followed over the next half-century. Coastal and riverine ports such as Shanghai, Fuzhou, and Hankou became centers of a booming tea export trade from the late 1840s to the 1880s. The trade was greatly facilitated by new forms of maritime cargo vessels (the clipper ships and soon thereafter, steamships) and global telegraph communications, which reduced the risk and cost of long-distance commercial transactions.

As early as 1800 about 35 percent of the total annual value of English imports consisted of so-called "tropical groceries" such as tea, coffee, sugar, rice, and pepper. Use of sugar in ever-increasing amounts was closely linked with the growing importation of stimulant beverages—tea, coffee, and chocolate—because sweetening was needed to naturalize these drinks into English dietary habits. Tea, bread, and jam became the convenience foods of the masses in mid-nineteenth-century Great Britain. Per capita average consumption of tea in that country rose from 1.41 pounds in 1801 to 1810 to 5.70 pounds in 1891 to 1900. Tea drinking further contributed to a temperance movement, reducing the popular addiction to alcoholic beverages (gin in particular) that threatened to sabotage Britain's eighteenth- and nineteenth-century industrialization (hence the expression teetotaler for alcohol avoiders).

Until well into the second half of the nineteenth century, Chinese tea dominated world markets. Tea growing and preliminary processing (into crude tea, which was then sold and commercially reprocessed for domestic or export markets) was traditionally a village enterprise in China. Farmers commonly regarded tea as a sideline cash crop, and production was small-scale, frequently haphazard, and widely dispersed amongst countless villages and local market towns in China's central and southern provinces. After decades of false starts and experimentation, mid-nineteenth-century British colonial entrepreneurs in northeast India (especially Assam) and Ceylon (Sri Lanka) and the Dutch in the East Indies (Indonesia) successfully began the plantation cultivation of tea. Plantations soon achieved economies of scale with the centralized, quasi-militarized control of large labor forces constantly engaged in cultivation and tea picking. Pioneering the large-scale, mechanized, and standardized processing of black tea, Anglo-American corporations launched vigorous and successful marketing campaigns which made brands such as Lipton and Brooke Bond household words worldwide by the early twentieth century. China's tea trade then struggled against global competition, while plantation tea production was even further extended by then to British colonies in eastern and southern Africa (Kenya and Nyasaland or Malawi).

SEE ALSO Balance of Payments; Canton System; Caravan Trade; China; Coffee; Drugs, Illicit; East India Company, British; East India Company, Dutch; East India Company, Other; Empire, British; Empire, Dutch; Empire, Ming; Empire, Qing; Guangzhou;Hong Kong; India; Indonesia; Iran; Japan; Jardine Matheson;Mercantilism;Monopoly and Oligopoly;Shanghai;Sri Lanka;Tata Family;Theories of International Trade;Unilever;United Kingdom;United States.

BIBLIOGRAPHY

Etherington, Dan M., and Forster, Keith. Green Gold: The Political Economy of China's Post-1949 Tea Industry. Hong Kong and New York: Oxford University Press, 1993.

Gardella, Robert. "Qing Administration of the Tea Trade: Four Facets Over Three Centuries." In To Achieve Security and Wealth: The Qing Imperial State and the Economy 1644–1911, ed. Jane Kate Leonard and John R. Watt. Ithaca, N.Y.: East Asia Program, Cornell University, 1992.

Gardella, Robert. Harvesting Mountains: Fujian and the China Tea Trade. Berkeley: University of California Press, 1994.

Moxham, Roy. Tea: Addiction, Exploitation, and Empire. New York: Carroll and Graf Publishers, 2003.

Mui, Hoh-cheung, and Mui, Lorna H. The Management of Monopoly: A Study of the English East India Company's Conduct of Its Tea Trade, 1784–1833. Vancouver: University of British Columbia Press, 1984.

Rossabi, Morris. "The Tea and Horse Trade with Inner Asia during the Ming." Journal of Asian History 2 (1970): 136–168.

Ukers, William H. All About Tea. 2 vols. New York: The Tea and Coffee Trade Journal Company, 1935.

Robert Gardella