Puer Tea: China's Next Hot Commodity?

By EMILY RAUHALA / HONG KONG

There is Champagne, France; Tequila, Mexico; and Parma, Italy — all places turned trade names known for their unique, high-quality foods. Now, if China has its way, there could be another: Puer.

This lush corner of Yunnan province in China's south is home to one of the world's hottest teas. Puer tea may not look like much — it is typically sold in heaps resembling cow patties — but one mug of these aged leaves can fetch up to $1,000. The drink is touted for its health benefits and is loved for its light, earthy taste. It is already a hit in Hong Kong, where rare teas are a status symbol among the city's élite, and it is generating hype outside China, too. Three high-profile Silicon Valley techies recently tweeted and blogged their way through a Puer tea tour of Yunnan. Dieters, meanwhile, are buzzing about rumors that Victoria Beckham, the svelte former Spice Girl, drinks Puer to lose weight.

Making Puer tea as internationally renown as Roquefort cheese could expand China's tea exports while adding a bit of luster to a food industry infamous for its health scandals. But building a Puer brand will depend on getting control of a market riddled with imposters, financial speculation and controversies.

The need for stricter control of the Puer industry became clear two years ago, when the Puer market went on a destabilizing roller-coaster ride. Some Chinese buy tea as an investment, much like Europeans buy wines. In the early part of the decade, thousands of cash-rich urbanites poured their savings into the Puer, causing prices to double, then triple. "People were buying anything," says David Lee Hoffman, a California collector. By 2007, the finest aged Puer was — quite literally — worth its weight in gold. As demand soared, however, quality suffered, fakes flooded the market and prices fell.

That's when Beijing stepped in. In an effort to restore confidence, piracy-prone China tightened controls to define exactly what should be considered real Puer. As of December 2008, only teas produced in Yunnan province's 639 towns and 11 prefectures and cities can be labeled "Puer." Branded tea must also be made with a certain type of leaf, using specified technology. Yunnan leaves aged outside the province are no longer considered authentic. The goal, officials say, is to protect Yunnan's heritage and build an internationally viable, niche brand.

Not everyone welcomes the rules. It is unclear if other Chinese provinces will adhere to the regulations and grow different teas under new names. The new standards, for example, shut out tea producers in neighboring Guangdong province, who claim that the tea they process is as authentic — perhaps even more so — than Yunnan's. Guangdong tea makers contend that it was Pearl River traders, not Yunnan farmers, that originally perfected Puer. Zheng Mukun, a tea master from Guangdong, says the province's claim dates to the Qing dynasty, when tightly packed leaves were fermented over the course of the three-month journey, by horse, from Kunming to Guangzhou. The blackened leaves became popular in Hong Kong and industrious southerners began to experiment with fermentation. At the 1957 Canton Fair, Zheng says, local tea masters shared their recipes with colleagues from Yunnan. Ever since, the provinces competed to produce the best teas. Earlier this month, at a trade fair in Hong Kong, a table of Guangdong tea vendors called the regulations "unfair" and "ridiculous."

Experts also have doubts that Chinese regulators can get enough control over the Puer market to build a premier brand. Beijing's standards only apply to domestic producers; competitors in Vietnam, Sri Lanka and Burma can continue to grow and sell their own "Puer" tea. Hoffman, the collector, predicts that fakes will persist and urges caution. "This has always been a buyer-beware market, and it will always be thus," he says.

Still, Hoffman is confident the industry can thrive — and he's put money on it. This fall, he plans to open a luxury tea shop in California that will be a gathering place for American aficionados and a showcase for his fine, aged Puers. "There is a lot of hype and marketing, but that doesn't interest me," he says. "I am only interested in taste." People have offered to buy his collection, but he's dismissed them in turn. He wouldn't trade it now, he says, not for all the tea in China.

A County in China Sees Its Fortunes in Tea Leaves Until a Bubble Bursts

By ANDREW JACOBS
Published: January 16, 2009

MENGHAI, China — Saudi Arabia has its oil. South Africa has its diamonds. And here in China’s temperate southwest, prosperity has come from the scrubby green tea trees that blanket the mountains of fabled Menghai County.

Over the past decade, as the nation went wild for the region’s brand of tea, known as Pu’er, farmers bought minivans, manufacturers became millionaires and Chinese citizens plowed their savings into black bricks of compacted Pu’er.

But that was before the collapse of the tea market turned thousands of farmers and dealers into paupers and provided the nation with a very pungent lesson about gullibility, greed and the perils of the speculative bubble. “Most of us are ruined,” said Fu Wei, 43, one of the few tea traders to survive the implosion of the Pu’er market. “A lot of people behaved like idiots.”

A pleasantly aromatic beverage that promoters claim reduces cholesterol and cures hangovers, Pu’er became the darling of the sipping classes in recent years as this nation’s nouveaux riches embraced a distinctly Chinese way to display their wealth, and invest their savings. From 1999 to 2007, the price of Pu’er, a fermented brew invented by Tang Dynasty traders, increased tenfold, to a high of $150 a pound for the finest aged Pu’er, before tumbling far below its preboom levels.

For tens of thousands of wholesalers, farmers and other Chinese citizens who poured their money into compressed disks of tea leaves, the crash of the Pu’er market has been nothing short of disastrous. Many investors were led to believe that Pu’er prices could only go up.

“The saying around here was ‘It’s better to save Pu’er than to save money,’ ” said Wang Ruoyu, a longtime dealer in Xishuangbanna, the lush, tea-growing region of Yunnan Province that abuts the Burmese border. “Everyone thought they were going to get rich.”

Fermented tea was hardly the only caffeinated investment frenzy that swept China during its boom years. The urban middle class speculated mainly in stock and real estate, pushing prices to stratospheric levels before exports slumped, growth slowed and hundreds of billions of dollars in paper profits disappeared over the past year.

In the mountainous Pu’er belt of Yunnan, a cabal of manipulative buyers cornered the tea market and drove prices to record levels, giving some farmers and county traders a taste of the country’s bubble — and its bitter aftermath.

At least a third of the 3,000 tea manufacturers and merchants have called it quits in recent months. Farmers have begun replacing newly planted tea trees with more nourishing — and now, more lucrative — staples like corn and rice. Here in Menghai, the newly opened six-story emporium built to house hundreds of buyers and bundlers is a very lonely place.

“Very few of us survived,” said Mr. Fu, 43, among the few tea traders brave enough to open a business in the complex, which is nearly empty. He sat in the concrete hull of his shop, which he cannot afford to complete, and cobwebs covered his shelf of treasured Pu’er cakes.

All around him, sitting on unsold sacks of tea, were idled farmers and merchants who bided their time playing cards, chain smoking and, of course, drinking endless cups of tea.

The rise and fall of Pu’er partly reflects the lack of investment opportunities and government oversight in rural Yunnan, as well as the abundance of cash among connoisseurs in the big cities.

Wu Xiduan, secretary general of the China Tea Marketing Association, said many naïve investors had been taken in by the frenzied atmosphere, largely whipped up by out-of-town wholesalers who promoted Pu’er as drinkable gold and then bought up as much as they could, sometimes paying up to 30 percent more than in the previous year.

He said that as farmers planted more tea, production doubled from 2006 to 2007, to 100,000 tons. In the final free-for-all months, some producers shipped their tea to Yunnan from other provinces, labeled it Pu’er, and then enjoyed huge markups.

When values hit absurd levels last spring, the buyers unloaded their stocks and disappeared.

“The market was sensationalized on purpose,” Mr. Wu said, speaking in a telephone interview from Beijing.

With its near-mythic aura, Pu’er is well suited for hucksterism. A favorite of emperors and imbued with vague medicinal powers, Pu’er was supposedly invented by eighth-century horseback traders who compressed the tea leaves into cakes for easier transport. Unlike other types of tea, which are consumed not long after harvest, Pu’er tastes better with age. Prized vintages from the 19th century have sold for thousands of dollars a wedge.

Over the past decade, the industry has been shaped in ways that mirror the Western fetishization of wine. Sellers charge a premium for batches picked from older plants or, even better, from “wild tea” trees that have survived the deforestation that scars much of the region. Enthusiasts talk about oxidation levels, loose-leaf versus compacted and whether the tea was harvested in the spring or the summer. (Spring tea, many believe, is more flavorful.)

But with no empirical way to establish a tea’s provenance, many buyers are easily duped.

“If you study Pu’er your whole life, you still can’t recognize the differences in the teas,” said Mr. Wang, the tea buyer. “I tell people to just buy what tastes good and don’t worry about anything else.”

Among those most bruised by the crash are the farmers of Menghai County. Many had never experienced the kind of prosperity common in China’s cities. Villagers built two-story brick homes, equipped them with televisions and refrigerators and sent their children to schools in the district capital. Flush with cash, scores of elderly residents made their first trips to Beijing.

“Everyone was wearing designer labels,” said Zhelu, 22, a farmer who is a member of the region’s Hani minority and uses only one name. “A lot of people bought cars, but now we can’t afford gas so we just park them.”

Last week, dozens of vibrantly dressed women from Xinlu sat on the side of the highway hawking their excess tea. There were few takers. The going rate, about $3 a pound for medium-grade Pu’er, was less than a tenth of the peak price. The women said that during the boom years, tea traders from Guangdong Province would come to their village and buy up everyone’s harvest. But last year, they simply stopped showing up.

Back at Menghai’s forlorn “tea city,” Chen Li was surrounded by what he said was $580,000 worth of product he bought before the crash. As he served an amber-hued seven-year-old variety, he described the manic days before Pu’er went bust. Out-of-towners packed hotels and restaurants. Local banks, besieged by customers, were forced to halve the maximum withdrawal limit.

“People had to stand in line for four or five hours to get the money from the bank, and you could often see people quarreling,” he said. “Even pedicab drivers were carrying tea samples and looking for clients on the street.”

A trader who jumped into the business three years ago, Mr. Chen survives by offsetting his losses with profits from a restaurant his family owns in Alabama. He also happens to be one of the few optimists in town. Now that so many farmers have stopped picking tea, he is confident that prices will eventually rebound. As for the mounds of unsold tea that nearly enveloped him?

“The best thing about Pu’er,” he said with a showman’s smile, “is that the longer you keep it, the more valuable it gets.”

China's Tea Boom & Bust

Tea has been one of China's main cash crops for the last decade. About 23,000 tons of Pu'er tea was produced in 2007. With the advantages of being a cholesterol reducer and its overall beneficial health effects, Pu’er tea became one of the greatest investment frenzies in China's economy since 1999, according to the New York Times.

During the boom, prices rose to record levels — allowing rural farmers to buy cars, build homes and send their children to school. Chinese citizens who put most of their savings into this "liquid gold" made millions of dollars during the boom era. Wholesalers started paying up to 30 percent more than they did the previous year — while production doubled to 100,000 tons from 2006 to 2007. We posted about the rise of Pu'er tea and its impact on tea workers last April, during the height of the boom in Fortune in the Tea Leaves. About 9 months later, it's a very different story.

By mid 2008, wealthy Chinese started to feel the pinch of the global economic crisis and the tea traders that used to buy up the cash crop in mass simply stopped coming. As the tea bubble popped, there was a devastating drop in prices. The going rate for Pu'er is now $3 a pound — a tenth of its peak price. More than a third of the 3,000 tea manufacturers and merchants have left the tea trade, according to the New York Times. The worst affected have been the farmers, many of whom have switched from tea to more lucrative crops like rice and corn.

Experts are comparing China's tea market to the U.S. housing bubble — where house prices rapidly increased to unsustainable levels, followed by a rapid decline in prices, which left many homeowners owing more on their mortgage than the market value of their homes.

Yet Chen Li, a former trader in the tea market believes that prices will eventually rebound and finds optimism in the mounds of unsold tea held by farmers and manufacturers. In an interview with the New York Times he says, "The best thing about Pu’er is that the longer you keep it, the more valuable it gets.” Yet if the "tea bubble" is anything like the housing bubble in the U.S., we may not see a rebound for a long time to come.

February 10, 2009 by Manasi Sharma

普洱茶原料降价或超普洱茶原料降价或超20%

普洱出口有所下跌普洱出口有所下跌 

“几乎整个普洱茶行业的价格都明降或暗降了。”在昨日举行的2008年中国(广州)国际茶业博览会新闻发布会 上,一名广东茶商透露,今年普洱茶原料价格有20%以上的降幅,更有数据显示云南晒青毛茶价格比去年下降50% 以上。 

普洱茶出口有所下跌普洱茶出口有所下跌 在昨日举行的新闻发布会上,广东省茶叶行业协会秘书长张黎明透露了一组数据:“2008年1~9月我国茶叶出口 22.76万吨,同比增长4.97%,只有乌龙茶和普洱茶出口有所下跌,其中乌龙茶下跌2.99%,而普洱茶却下降 33.48%。” 

一名从2004年始进入普洱茶市场、主推古树茶的商家深切体会市场的变化:在2007年,整个市场的茶叶原料被 商家争相哄抬,价格不断上涨,导致普洱茶市场价格的快速上浮;而今年原料起码跌了20%~50%,导致市场价格 也相应下调。在该名商家看来,市场经过1年的沉淀,曾经存在的水分已逐渐被挤干,回到较为踏实的原地。 

不过,行内人士认为,普洱茶市场需要一段为期不短的时日才能恢复昨日风光,主要是高峰期时部分不良炒家破 坏了市场平衡,影响市场信心;另外,负面消息的传播也极大损害了普洱茶的声誉。 

也有观点认为,目前全国茶叶总产量的75%主要依靠内销,市场首先需要调动内需,令消费者重新接受普洱茶, 并对普洱茶有更深的认识;其次要树立正确的普洱茶标准,不将其视同单一的投资品种。(记者 林琳)

Perspectives on Storing and Aging Pu'er Teas: Buying Aged Tea -- But Why?

by WARREN PELTIER

A Brief Historical Perspective

Not so long ago, aged tea could be had for pretty cheap. But all of a sudden, a lot of people in Asia got pu'er crazy, and started buying up all kinds of aged pu'er -- any pu'er -- regardless of quality or price. Let’s take a glimpse at some of the historical highlights of all of this:

Hong Kong has a long history of Pu'er drinking. Pu'er is used here for its medicinal properties, and has long been a favorite tea for consumption during dim sum meals in Hong Kong teahouses.

People’s Republic era: Hong Kong became the “tea storehouse” for pu'er tea. It was sent from Guangzhou to Hong Kong, where some was consumed locally by Hong Kong people, and some was exported to South East Asia.

1950s: one tong of good quality pu'er bing cha cost just a little over 3 HKD. By that time Guangdong people knew that the older pu'er gets, the better it is. But at that time, even old pu'er was only 1 yuan per pound more expensive than newer pu'er. 

1986: One 30-year-old aged Hong Yin (Red Label) bing was selling in Sheung Wan-area tea stores for a little over 170 HKD; some Lao Hao bings aged to 50 or 60 years were selling for 800 HKD. At that time it was already considered very expensive. But today it would be worth in the tens of thousands of HKD.

Starting in the 80s, Hong Kong’s economy started to boom, creating wealth, and a wealthy class of people. Some of these people started collecting pu'er teas as a kind of investment speculation.

In the mid and late 90s, some of the big teahouse owners went overseas -- because of uncertainty about Hong Kong’s future. But after 1997, they came back, started to clean their storehouses, and discovered that there were many kinds of good-quality aged pu'er in their stores. They then proceeded to sell off these stores to collectors in Taiwan and overseas. And two teahouses in particular -- Gam San Lau (金山樓) and Long Moon Lau (龍門樓) (see end-note) -- had stores of Tong Qing Hao Lao Yuan Cha (同慶號老圓茶), aged to almost 100 years in their possession.

Pu'er collectors, especially from Taiwan, would go to the tea farms and factories in Yunnan, sometimes buying up whole crops of tea leaves before they could reach market -- and thus securing their own private stock of tea to be privately pressed into bings for aging.

And that is what kicked off the big pu'er mania -- where everyone who was anyone had to have 100-year-old aged pu'er in their collection. And then supplies of good pu'er, even recently produced, became scarce. Of course, the likelihood of finding 100 year aged pu'er nowadays is virtually impossible.

Value Decisions

Just assume that there were some real, verifiable 100-year-old aged pu'er available for purchase to lucky you. And best of all, that you could actually afford it without going broke. Would that particular brick or bing of pu'er be worth it? That’s the question that has to be asked with any aged tea. Is it worth it to buy this tea? First of all, you probably don’t know the whole history of that tea. Sure, you can research wrappers and factories and batch codes. But that doesn’t tell you anything about how Person A, who first bought the tea, stored it. It doesn’t tell you whether the tea happened to come in contact with any extraneous odors. It doesn’t tell you that Person B stored the tea on a shelf next to a pair of his stinky shoes. It doesn’t tell you that Person C, who then bought the tea, brought it home in a rain storm, and it got all soaked. It doesn’t tell you that Person D doctored the tea by adding extraneous scents from camphor wood to the tea, just because that person thought that the tea smelled kind of like stinky shoes and mold, and thought that it would smell better (and perhaps taste better too) if it were scented with camphor wood.

Since you don’t know the exact storage methods used during the history of that tea, and since you haven’t tasted that tea, how will you know if that tea, aged 100 years is really good or not? You can’t know. And you also won’t know if it’s worth the price you paid. It just may be too big a risk to take.

So how pu'er teas are stored is important, not just for drinking, but also for resale value, if one were to ever be insane enough to sell part of his/her pu'er collection. Of course, pu'er manufacturers know how to age and store tea. And they know how to ship it. So you don’t have to be worried so much how the tea was stored in some warehouse at the factory.

But whether a tea is aged 10 years or 100 years, how the tea was stored is an important factor that will affect the quality of the tea over time. The longer the period of aging, the more important how a tea was stored during all those years becomes. And because of this, one should keep in mind that just because a tea is old doesn’t necessarily mean that it’s good. Of course, Chinese have a saying with pu'er: “the more aged, the better the tea becomes.” But that’s all relatively speaking. If the pu'er was stored improperly, or under non-ideal conditions, then it may be mediocre -- or bad -- aged tea.

In the past few years, in Mainland China, many extremely wealthy people (including many who don’t know a thing about pu'er) got into collecting pu'er as an investment. They speculate in pu'er, driving up the prices -- and driving real pu'er lovers out of the market. There are now many pu'er drinkers who are extremely negative about buying aged pu'er. And they refuse to buy any pu'er until the prices start reflecting the actual value of the tea. 

I myself refuse to buy any aged pu'er, partly because of outrageous prices, and partly because I’m not sure how that particular tea was stored; and also because there are so many fake and forged aged teas that it’s too complicated to keep up with. Now, when I buy pu'er, I visit several reputable dealers where I can sample many relatively new (aged 3 years or less) sheng pu'er bings; and compare prices. If I taste a particular sheng pu'er and I like it now, then when I take it home and store it away for say 7-10 years (or even longer), surely it will taste much better after proper storage and aging. 

Did the Pu'er Bubble Go Bust?

Pu'er prices rose dramatically in the first half of 2007, with prices of mao cha doubling. But this didn’t last long. By the end of June, prices had fallen dramatically as the following examples illustrate:

2007 Price Comparison Prices of Mao Cha

April 1, 2007

Banzhang Ancient Tea Tree: 1400 yuan/Kg

Bulang Shan Ancient Tea Tree: 600 yuan/Kg

July 1, 2007

Banzhang Ancient Tea Tree: 600 yuan/Kg

Bulang Shan Ancient Tea Tree: 300 yuan/Kg

According to market reports, in July 2007, pu'er mao cha prices remained calm, but tea farmers in Nan Nuo Shan (南糯山) and Bu Lang Shan (布朗山) were unwilling to ship their harvests because the going price was so low. And factories in Menghai stopped receiving shipments of tea; many factories reduced the production of shu pu'er. 

So overall, the market was in a bit of a turndown in 2007. No longer were consumers driving the market based on quantity: by the end of the year, they were demanding quality. And that drove prices back down. The demand just wasn’t there anymore.

Today’s Pu'er Market

At the end of June 2008, in Guangdong’s Fang Cun Tea Market, we see pu'er tea prices going down -- sometimes dramatically. A 357-gram 2008 Da Ye 0622 Sheng Bing is selling for 350 yuan per tong. With seven bings in a tong, that comes to 50 yuan per bing. Don’t take my word for it -- see for yourself at this page.

If the prices of pu'er continue to fall, that will be good for consumers. And maybe now is the time to start stocking up on pu'er. A recent trip to the Dong Pu Tea Market, in Fuzhou’s Jin An district, seems to verify suspicions. Tea vendors there say business is slow. Shu bings were selling for a mere 30 yuan. A 400-gram 2007 Meng Ku Large Tea Tree shu bing sold for 80 yuan. And that was the vendor’s asking price. I didn’t even try to bargain him down. If I had bought a tong or two, I probably could have got them for 60 or 70 yuan each. Keep in mind, Dong Pu Tea Market is a backwater tea market with only about 20 vendors. Much larger Pu'er markets, like Guangzhou or Shenzhen, or even Fuzhou’s larger Five-Mile Pavilion Tea Market, probably have stores of sheng bings at a much lower price point. Pre-2007 bings however, and the more famous brands of pu'er are still selling for a relatively high price. As the 2008 bings come onto the market, though, I suspect they will sell for relatively cheaper prices than in the past.

If you want further proof, you can check online auction sites like eachnet.com. The lowest price for a 250-gram 2000 sheng zhuan (brick) was 21.8 yuan. Shu bings are going for as low as 18 yuan. You see similar low prices on online tea vendor sites in China. And that leads to another question: with prices so low, what will the future hold for the new huge tea markets that sprouted up overnight in places like Shenzhen during the days of Pu'er Mania?

Pu'er Reality Check

What makes people go so crazy about pu'er anyway? Is it the moldy smell that people find so captivating or what? What’s all the mystique surrounding pu'er? And why would individual pu'er collectors go out of the way to buy a whole tea farm’s crop and hoard it? Why? Tea Hoarder! That’s tea insanity! And why would anyone be willing to fork over hundreds to thousands of yuan for a single bing? If you compare the quality of leaf in a bing to that of any other kind of tea (say Tieguanyin, for example), are you really getting value for money? For the most part, the pu'er leaf that is used for bings comes from the 4th to the 8th leaves on the bush (or tree). These are pretty large, coarse leaves that are used. Don’t fool yourself: those leaves aren’t big because they come from some thousand-year-old “ancient tea tree.” So why would anyone willingly spend large sums of money for teas that are made with so-called inferior quality leaves? I find it ironic that the teas I buy actually cost as much as, or even more than, the teaware I buy. It’s an expensive lifestyle.

Sensible Enjoyment

So my advice is: Wait awhile and see if cheaper prices make their way through the supply chain. And then, buy pu'er because you like the taste, not because of fame or reputation, or because of the duration of aging. Tea should be enjoyable, not an aggravation. If some of your pu'er tastes good now, then drink it now and enjoy it. Why wait to store it? But if you can wait, then store some away and see what happens. So, enjoy some now, enjoy some later. Maybe that’s the best way to buy and store pu'er.

普洱茶泡沫破了

央视国际 www.cctv.com　　2007年06月15日 20:02 来源：CCTV.com

　　6月3日，普洱茶的产地――云南普洱市宁洱县刚刚发生了里氏6.4级的地震，其实就在同时，各地的普洱茶市场也在经历一场地震，最近一个月，普洱茶的价格普遍下跌了20％－50％，有些投资者囤积的数百万、上千万元的普洱茶饼一夜之间严重贬值。我们今天就先来看看广东，广东是全国最大的普洱茶消费市场，每年的销量占到国内总产量的70%。

　　普洱茶这轮暴跌，让市场措手不及。从去年开始，普洱茶价格就一路走高，特别到了今年前四个月，市场上普洱茶的均价上涨了3至4倍，个别品种甚至上涨了几十倍，远远超过股市同期涨幅。当时，也有不少炒家从炒做普洱茶中，获得了比炒股还要丰厚的暴利。

　　广州茶叶市场，是全国最大的普洱茶集散地，也是普洱茶价格上的一个晴雨表。在芳村茶叶城记者看到，来逛茶叶市场的顾客已经非常稀少，整个大厅显得空荡荡的，因为闲来无事，茶叶店的一些员工干脆把这里当作了运动场。这与普洱茶火爆时的场面形成了鲜明的对比。

现在的茶叶都不出售大量的储存在家里记者又来到了附近的一个茶叶市场，这里也以销售普洱茶为主要业务。与芳村茶叶城一样，记者看到的同样是一个没有顾客的一座茶城，据这里的普洱茶经营者介绍，造成现在普洱茶市场萧条的原因，除了淡季影响以外，普洱茶价格的大幅度下跌和集体“跳水”，也是一个重要的原因。那么，目前在广州市场，普洱茶的销售价格到底降了多少呢？

　　销售人员：“最火的时候像7572跟7554（普洱茶规格）这个都要到两万多块钱。”

　　记者：“现在卖多少？”

　　销售人员：“九千多块钱。”

　　普洱茶从两万多元的最高价，降为现在的一万以内，价格下跌了一半，这让许多普洱茶的买家始料不及，然而让他们更没有想到是的，整个下跌的过程，仅仅用了30多天的时间。这位普洱茶的经营者，这样解释了普洱茶的萧条原因。

　　普洱茶经营者：“因为事先（普洱茶价格）炒得太高了，变成市场没有交易，没有交易就停下来了，也没有人接（买）市场上交易量不是很大。

　　据了解，这次普洱茶之所以在广州市场上价格大跌，是因为就在一个月前，广州市场上，一些人对普洱茶进行了炒作，而炒作的程度有人用“疯狂”两个字来形容。那么，炒作普洱茶究竟有多大的利润呢？

　　在广州的南方茶叶市场，记者了解到，从2006年下半年自今年的年初，普洱茶中的知名品牌大益、下关、中茶等，成为炒作的对象。

　　销售人员：“一天几百的（涨）。”

　　因为这些品牌质量稳定，知名度高，收藏升值的潜力大，因此，在普洱茶市场上，受到许多炒家的追捧。

　　商家：“一天一个价，每个月翻一倍。”

由于炒家的炒作，市场上有的品牌，一件30公斤左右的普洱茶，从不到5000元的出厂价，一下子涨到了23000元，上涨了近5倍。

　　商家：“（有的）涨了百分之二三百。”

　　如此高的利润，极大的刺激了市场对普洱茶的需求，一些对普洱茶一无所知的人也纷纷投入资金，加入到炒作普洱茶的行列，一时间，一场爆炒普洱茶的场面在广州茶叶市场展开。

　　商家：“今年的四月份是破记录的，（一天）能销售四五百件（十二吨或十五吨），凡是有店就必须摆上普洱茶，卖普洱茶甚至在通过这两年广州这边的推动，包括炒作这方面，在全国也铺开了。”

　　

普洱茶市场幕后操盘手

　　那么，在广州的普洱茶市场，厂家和经销商这只看不见的手，究竟是如何来掌控市场的呢？黄建璋，广东省文化学会茶文化研究专业委员会副会长，《茶艺》杂志主编，一直对普洱茶市场进行跟踪调研，他认为首先是经销商通过向普洱茶的生产厂家交纳押金，来取得市场上对某种产品的垄断地位，而这种押金的数目也大得惊人。

　　黄建璋：“（厂家）跟商家有一个包销的协议，（押金）据听说是从一百万到两三百万，甚至翻到去年给他们的押金，据听说达到一千万。”

　　为了证实经销商向厂家交纳巨额押金的说法，记者向这位经销商进行了询问。

　　经销商：“三五百万，有的是一千多万，有的三千万都有。”

　　经销商在取得了某种规格的经销权以后，开始放货。

　　经销商：“先放个大概20%左右投放市场，然后再找一些比较亲近的人，再把它收购回来。”

　　而经销商回收的价格，则比卖出时的价格要高出许多。

　　经销商：“我原来卖给你比如说五千块钱卖给你，现在市场涨到七千块钱。有人过来问我们要，那我们就可以把你手上的收回来嘛。你愿意这个价格卖给我们我们就收，我们再卖个别人。

　　经过控制卖出的数量，造成市场缺货的假象，叫做“捂盘”，然后经销商通过高价回收的手段，抬高自己经销品种的价格，这样，经销商就完全掌控了市场上普洱茶的价格。

　　经销商：“你控盘控到多少程度，你自己心里有数，你不卖的话你再出去收一收，价格自然就往上走了总量就这么多你在放出来收，是不是自然而然价格就抬上去了，这也是控盘嘛。”

　就此记者得到了这样的一个操作流程，以市场上一件30公斤出厂价为4800元的普洱茶为例，一级经销商用重金取得经销权以后，在市场上只放出20%的量，造成这种产品紧缺的气氛，然后又以高价进行回收，以抬高其价格，然后再将其全部抛出，经过二级三级经销商不断的重复炒作，最后将价格抬到了23000元，而这时在23000元高位上接手的许多散户，则被牢牢的套住。

　　2003年3月，云南省质量技术监督局公布了，云南省普洱茶地方标准：普洱茶是以云南省一定区域内的云南大叶种晒青毛茶为原料，经过后发酵加工而成的散茶和紧压茶。在云南的产茶区，记者看到，采摘下来的茶叶经过这样的铁锅杀青，然后进行晾晒，然后存放，让它自然发酵。制作过程并不复杂和神秘，一些医学专家也称，普洱茶的特殊功效，还没有人做出过足够可信的实验结果。实际上，从功效上，普洱茶与其他茶叶并没有多大的差别。

　　钟先生，原来做木材生意，今年3月份在朋友的劝说下将做木材的60万元钱，购买了普洱茶，希望其能够升值后抛售。

　　钟先生：“估计在半年之内，能够赚10%以上（利润）。”

　　

普洱茶囤积之苦

　　然而不断下跌的价格，不但使他没有赚到预期的利润，而且现在自己资金也被普洱茶套牢，他现在要做的只有等待。在广州，像钟先生一样，因为购买普洱茶而被套住上百万的人也不在少数。采访中记者了解到，目前市场上普洱茶真正用于消费的并不多，而多数则被放到了仓库里，让其升值。

　　记者：“这是你的？”

　　符建深：“对对。”

　　记者：“这大概有多少件？”

　　符建深：“有两三百件。”

这里所存放的各个知名厂家的普洱茶足足有6吨多。符建深，现在经营一家旅游山庄，2006年开始购买普洱茶，由于购买的数量不断增加，为此，他专门租了一个仓库。在这个仓库里记者注意到，这里所存放的各个知名厂家的普洱茶足足有6吨多。他还告诉记者，他的3个朋友在他仓库的隔壁，同样存放了普洱茶。

　　符建深：“希望越多人懂得这个茶的价值，我们大家财富也会跟着上来的。”

　　现在在广州，究竟储存有多少普洱茶，记者无法知晓，但却听到了这样的说法：“（普洱茶）只有5%在消费者的肚子里，还有95%全部在投资者收藏的仓库里。”

　　符建深：“从现在开始，一克普洱茶不进，广东这个市场。那么广东在5年甚至8年喝现在存有的普洱茶都喝不完。”

　　面对普洱茶成了疯狂炒做的对象。一些行家告诉记者，和以前不同，这轮暴炒中出现了很多反常的现象。比如说，普洱茶本来应该年代越久远，价格越昂贵，可是，前一段时间，有些新茶的价格卖的比几十年的老茶还要贵上几倍，让普洱茶的行家里手都大跌眼镜。那么，这种反常的背后到底隐藏着什么秘密呢？

新茶价格上涨内幕

　　垄断货源、虚假交易、抬高价格，看来炒茶客和股市上那些庄家操纵股价的办法如出一辙。而且这些炒家和股市庄家还有一点相似的地方，就是善于制造概念。他们在不断抬高普洱茶价格的同时，还四处传播普洱茶具有降血脂、降血压、降血糖的神效。可是，市场暴跌之后，人们才发现，原来炒家的那些概念只是夸大其词的宣传。

　　概念泡沫经过这轮暴跌，广东很多炒茶客，现在已经被深度套牢。现在他们都寄希望于年底的时候，市场行情能够有所好转，能将手中套牢的普洱茶抛出去，至少把本赚回来。然而，在这个明显供大于求的市场上，普洱茶的价格还能回到他们期盼的高位吗？

　　陈国璋，经营普洱茶多年，对现在低迷的普洱茶市场，年底是否能走出低谷，表示了担忧。

　　陈国璋：“我觉得（价格）是下的多。”

　　而黄建璋认为，除了一些品位真正好的普洱茶会升值以外，大部分的普洱茶的价格会下降。

　　黄建璋：“这里面含的水分很多，当有一天给人家发现到这里面的奥妙，也就是说泡沫一旦被吹开被吹破了，那么整个普洱茶的行情，价位就会掉下来，到那个时候掉下来那就可惨了。”

　　云南省西双版纳地区的勐海县，是普洱茶著名的产地之一，这个地区每年普洱茶的价格，直接影响云南省全省的原料价格，因为在云南许多产区普洱茶原料的定价，都要参照勐海县的价格。

　　记者：“那么现在的价格？涨得什么样的地步？”

　　茶商：“现在涨到台地茶，150（元）以上，250（元）200（元）都有，以前是一公斤毛茶台地茶25（元）30（元）35（元）都有。”

　　据了解，在勐海县班章的古树茶，由去年的每公斤320元，一下子爆涨到今年春天的每公斤1250元，上涨了近4倍。

　　茶商：“大树茶老树茶，上浮了两到三倍，台地茶一倍还要多一点，比去年的价格统统都要上浮了。”

　　迅速上涨的普洱茶的价格，让勐海县的许多人始料不及。

　　现在，每天一大早，爱伲族的康蛇，都要和家人一起到自家的茶园里采茶，她家所在的南糯山，是勐海县重要的普洱茶产地，自从今年春天茶叶上涨以后，全家人就很少休息。

康蛇：“茶叶发的很多，因为茶叶价格很好，所以不想给它发老了，所以比较忙一点，经常来摘。”

　　记者：“以前多少天摘一次？”

　　康蛇：“差不多隔半个月摘一次。”

　　记者：“现在呢？”

南糯山村的这位负责人告诉记者，虽然现在茶叶的价格涨了两倍多，但许多村民还是希望茶叶的价格能够继续再涨一些，所以现在的茶叶都不出售，而是大量的储存在家里。这不得不让他感到不安。

　　在勐海县，对于迅速膨胀的茶叶价格，担忧的还有许多人。

　　云南省茶叶商会副会长曾云荣：“从原料近期飞涨的情况来看，我表示很担忧，因为从长远看，价格的大起以后就必然会出现大落。”

　　云南省茶叶商会副会长曾云荣告诉记者，由于虚高的茶叶价格，使许多农民奇货可居，对茶叶的出售价格，有了更高的期待。

　　曾云荣：“这个茶昨天开800元，今天开1000元，明天开1200元，他就看到这个利益，所以他就观望，一观望就等待，一等待市场一变化，他就吃亏。”

　　在勐海县的一些普洱茶生产厂家，记者了解到，因为目前普洱茶的毛茶价格偏高，使得许多普洱茶的生产厂家，不愿多进原料。

　　记者：“你们预计进原料进多少？”

　　生产厂家：“大概200吨左右吧。”

　　记者：“那你现在进了多少？”

　　生产厂家：“今年大约进了二三十吨，四十吨左右。”

　　广东的普洱茶市场在人为操纵之下，短短半年间走出了暴涨暴跌的行情。一批接盘的炒家，手里囤积了大量普洱茶现在却无法出手。其实，这轮疯狂炒做不仅带动了普洱茶的价格大幅波动，就连云南当地用于加工普洱茶的毛茶，价格也跟着跌宕起伏。

　　在炒做风的推动之下，普洱茶产业陷入了一个恶性循环——原料价格虚高，造成许多厂家减少进购原料，而厂家减少进货，又使囤积毛茶的中间商难以出货。那么，现在勐海县，那些中间商手里被套住的毛茶到底有多少呢？

　　据了解，由于前些时候毛茶炒作的价格过高，目前的茶价已经开始下跌，许多中间商已经被牢牢套住。一位不愿透露姓名的中间商这样告诉记者。

　　中间商：“现在有好多在这方面出现很大的问题，有压的多的一百吨的也有

　　两三百吨的都有。他们不会出手，他们要等市场回升他们才会出手，所以说现在中间商是不动的。”

　　康蛇：“现在隔五六天，六七天就可以来摘了。”

　　康蛇告诉记者，由于现在茶叶涨价，她们家的收入也比往年有所提高。每次采茶回来，康蛇都要将茶叶倒如锅里进行杀青。

　　记者：“你这个炒出来就卖吗？”

　　康蛇：“要是要卖，但是还是要留一下，看一下这个市场，如果价钱不是我们想象的那样高，就不卖。”

　　在康蛇的家里，记者发现了许多储存的茶叶。

　　记者：“有多少斤？”

　　康蛇：“有三四百公斤。”

　　记者：“那为什么不卖呢？”

　　康蛇：“因为人家说会涨价，所以暂时先留着吧。”

　　记者：“如果以后真的跌了怎么办？”

　　康蛇：“我也不知道。”

曾经当过勐海县茶叶办公室主任的曾云荣告诉记者，目前现在勐海县每年产春茶5000吨，而现在存在中间商仓库里的，也是一个不小的数量。

　　记者：“现在据你估计中间商存的茶叶有多少？”

　　曾云荣：“估计勐海1500到2000吨左右。”

　　那么，究竟是什么原因使勐海县今年普洱茶的原料价格，涨幅如此之大呢？曾云荣：“今年（炒家）通过成品茶的炒作以后，大量获取利润效益以后转入原料收购的炒作。”

　　在勐海县，记者看到，大小的普洱茶生产厂家，遍地开花，许多地方，一家挨着一家，据了解，由于目前普洱茶价格的不断攀升，并且生产用的工艺设施，并不复杂，因此目前已有以前的10多家加工企业发展到123家。

　　岩公告诉记者，目前勐海县一年能生产毛茶1万1千吨，而实际上勐海县100多家工厂实际需要毛茶3万吨以上，近2万吨的缺口，自然加剧了企业间对原料的竞争。因此，今年的普洱茶原料的上涨，也在情理之中。调查中，记者了解到，针对目前炒作普洱茶的现象，国家要制定一个普洱茶的统一标准，防止各种良莠不齐的普洱茶进入市场，参与炒作。

　　另一方面，针对普洱茶加工企业遍地开花，抢夺原料，哄抬价格的现象，要在建厂规模，资金上，提高准入标准，关小厂，建大厂。从根本上制止炒作原料价格的现象。

Of All the Tea in China, 'Puer' is the Hottest

Source: Dow Jones Newswires
02/10/2007

Zhuhai, Oct. 2 - In this booming economy, the latest investment fad has everything to do with the price of tea in China.

More precisely, it has to do with the price of puer.

A type of tea commonly pressed into Frisbee-shaped cakes, puer (pronounced "poo-ahr"), was long the domain of a small group of tea collectors. Earlier this year, speculators discovered the tea, driving up its value.

Puer, with a medicinal flavor and smoky aftertaste, improves with age unlike other teas that grow stale. Sellers claim it aids weight loss and lowers blood pressure.

The price of one of the hottest varieties of puer soared to nearly $35-a-cake this past April, seven times the $5-a-cake value just three years ago. Today, a cake of puer sells for nearly $16, a 60% backslide from the peak, fueling fears of a crash.

Puer's popularity reflects how China, awash in cash and slim on investment outlets, is primed for speculation of even the most ordinary -- or unexpected -- assets.

The puer boom spurred 45-year-old Yunnan native Zhang Bing to open a puer exchange in June to help traders find willing buyers and sellers. The exchange, lined with shelves of puer cakes, doubles as a meeting place for a puer club Mr. Zhang started last month.

"It's just like stocks," said Mr. Zhang, eyeing the latest puer price fluctuations on a flat-screen TV mounted by the doorway of the new exchange.

Such efforts are frowned upon by collector Bai Shuiqing, 52, who is so well-known in the industry that his autograph appears on commemorative cakes of puer. Mr. Bai says he already has the "guanxi," or connections, to sell his tea.

Mr. Bai is reluctant to talk about the value of his puer, saying he collects it for its taste, not its monetary value. Still, he estimates his 56 cakes of 100-year-old puer are worth about $640,000. He has two 150-year-old cakes whose value he declines to discuss. Last year, Mr. Bai started selling hand-selected cakes of puer marketed under his name.

At his vast tea warehouse in Hong Kong, Mr. Bai picked up a small piece of the tea, broken from its original cake, and placed it in an earthen teapot engraved with his name. He poured hot water in to rinse the leaves, discarding the first infusion, in what is called "awakening" the tea, and poured the second into a small, clear serving pot.

"Smell this," he said, beaming, and held out the steaming pitcher of clear brandy-colored liquid, a hue indicative of well-aged puer. "This is the best tea in the world."

Mr. Bai says he can divine the age of his puer by taste alone. Still, he keeps the authentication papers for aged cakes carefully sealed in plastic.

Like wine, puer is judged by vintage. At the top of the scale are 150-year-old cakes that can fetch more than $13,000. Newly minted cakes -- which taste bitter and strong compared with aged ones -- range from $13 to $25. Ideally, puer should be stored in airy, humidity-controlled rooms, away from sun and pungent odors that might penetrate the leaves.

Puer, once a gift for emperors, was long relatively unknown in mainland China. Even in Yunnan, where the tea is cultivated, locals preferred plain old green and black tea.

But puer's popularity in Taiwan, Hong Kong and Guangzhou trickled to the mainland around 2004, stirring interest among consumers. Sensing a tourism peg, the local Yunnan government in 2005 sponsored an unusual publicity campaign for the tea in a modern-day version of the caravans that once plied trade routes to Beijing.

The caravans were stocked with puer from Yunnan tea companies that co-sponsored the event. The procession made promotional stops in major cities along the route to the capital. The voyage was broadcast on TV, anchored by Zhang Guoli, a famous actor best known for his role as Emperor Kangxi of the Qing Dynasty, the era from which puer dates.

Puer's popularity skyrocketed, and the elite crowd of puer connoisseurs was joined by newcomers who possess neither their expertise nor their devotion to it. A 150-year-old cake of puer went on a promotional tour of the country in March, starting from the Forbidden City in Beijing. It arrived in Yunnan province later that month in the city of Simao, which had changed its name to Puer to help promote tea sales. The tour was sponsored by the city's government, which billed it as a homecoming for the tea.

The Yunnan government recently named puer one of the region's 10 prized cultural resources. In Beijing, puer cakes were marketed as a replacement for traditional moon cakes during the recent mid-autumn festival. Puer is cropping up in restaurants, which display prized vintages like a wine list. Exclusive clubs are opening in Beijing and Guangdong, where the rich gather to drink the tea and learn about its history.

Businessmen armed with cash were elbowing for puer by the case (each case contains 84 cakes). Tea leaves are being hoarded. It used to take weeks for the first batch of puer to sell out, according to Scott Wilson, a tea seller based in Kunming. This year, by the time it arrived in town, the entire stock was sold out.

Mainland Chinese tourists, toting magazines that chart the value of name-brand puers, visited Hong Kong tea shops to buy out entire stocks of recommended tea, says Henry Yeung, managing director of Sunsing Tea House in Hong Kong.

"They don't know anything about tea," sniffs Mr. Yeung, 30. Like others in the old-school puer crowd, he says novices, clueless about how to select and store quality puer, are likely to be duped by fakes.

Counterfeiters have printed knockoffs of popular labels, prompting one maker, Menghai Tea Factory, to employ Chinese money-printing technology to make its wrappers hard to duplicate. The company also set up a hotline for tipsters and established an investigative team to track suspects.

Other factories have cut production of regular green and black tea. Farmers are mixing in lower-quality leaves to puer harvests to artificially boost production. Long-time puer drinkers such as Mr. Yeung turn up their noses at the 2007 vintage, which they say is poor quality.

The boom has set off a wave of conspiracy theories on how it began. Some distributors whisper it started after one company withheld supplies to create the illusion of demand. Others posit that greedy businessmen hired imposters to bid up prices on their stocks of puer.

Tea industry officials fret about a crash. Still, current values are more than double what they were a year ago.

Farmers could be among the hardest-hit from a bust. Industry watchers say that thanks to puer, this year marks the first time tea farmers -- many of whom are ethnic minorities living on the southern Chinese border -- have made a livable wage. The broad-leaf trees that produce puer take three years to mature, meaning farmers who have invested in tea trees are gambling that prices will stay high.

Collectors like Barry Tam aren't worried. This year, the 33-year-old who lives in Hong Kong bought a 100-year-old puer cake for about $13,000 and says he sold it six months later for double that. If the bottom should fall out of the puer market, reasons Mr. Tam, "even if I cannot sell it, I'll drink it."

Newslinks (20.02.2008)

Wednesday February 20, 2008

Liquid asset
Like wine, pu-er tea ages well and the more mature the tea, the higher its price..

AT THE Pek Sin Choon tea company in Singapore’s Chinatown, a golden gift box with floral motifs is brought out.

The round, burnt-looking object inside is carefully taken out for a closer look.

The untrained eye can’t tell what it is. But show it to a tea collector and his heart will beat faster.

That is because the undistinguished looking thing is a valuable disc of pu-er tea from the 1930s. It has been in the family of Peh Ching Her, 39, the shop’s marketing manager, for many decades.

Chinese tea is not just a beverage to sip along with dim sumand bak kut teh. Pu-er tea, in particular, can be an investment.

He has more than 10 years’ experience dealing with tea and says he is not sure how his family got hold of it.

The pu-er is considered a rarity and is worth a fortune – about S$150,000 (RM345,000) he estimates – although he also adds that “it is definitely not for sale”.

The fragile disc is carefully returned to the box. If broken, it loses its value.

If you think Chinese tea is just a beverage to sip along with dim sum, think again. Pu-er tea, in particular, is seen as an investment.

Named after the Pu-er county in Yunnan province, China, the tea has a woody taste and is dark golden red in colour. It comes in various forms: disc-shaped cha bing or tea cakes, hump-shaped lumps or brick-like blocks. It is usually wrapped with paper and the name of the tea and date of manufacture stamped on it.

Because it is fermented, pu-er ages well, unlike other teas such as jasmine which lose their fragrance with time.

Carrie Chen, 38, owner of Tea Bone Zen Mind, a 14-year-old tea house in Seah Street, says the taste of pu-er gets milder with age, and the colour of the tea becomes more “shiny”.

Another tea master, Chen Lian Wei, 24, from Si Chuan Dou Hua Restaurant in Beach Road, adds that the taste and aroma of the tea improves as it matures, contributing to its value.

On the health front, aged pu-er is said to help lower high blood pressure and cholesterol, and some believe it can help with weight loss.

It’s no wonder then that pu-er is a collectible, and people can make a tidy sum from collecting discs of the tea.

In 2002, Peh was selling a disc of pu-er for S$6. He says that same disc is worth S$60 (RM138) today, as the tea has aged.

Similarly, Chen says a 20-year-old pu-er can be worth three times more than 10-year-old pu-er, which is selling for about S$80 (RM184) for a 250g disc.

Pu-er tea can last a long time, a century or more. The oldest pu-er is supposedly 200 years old and is considered an artefact.

Peh says whether or not collectors drink their aged pu-er depends on two factors.

“If they have more than a piece, and if they can afford it, they will drink it,” he says. Otherwise, most collectors tend to keep their pieces.

There are more than 10 grades of pu-er tea and the ones usually drunk now are those made during the 1980s.

As a rough guide, Si Chuan Dou Hua’s Chen says pu-er aged 30 years and above are stored and not drunk as they are expensive.

He says people began investing in the tea about 20 years ago in Taiwan. Then, goods could not be directly imported from China to Taiwan for political reasons.

“As such, traders could only bring in small quantities of pu-er from China to Taiwan through Hong Kong, making it more valuable,” he says.

In Singapore, pu-er collecting began in the mid-1990s. The tea experts say collectors here are mostly businessmen who prefer to keep a low profile, and collect only tea that is at least 30 years old.

But younger people are catching onto the trend, buying younger teas, he says.

The good news is you don’t have to be filthy rich to invest in pu-er. The younger teas cost between S$12 (RM27.60) and S$100 (RM230) a disc, depending on their quality.

Collectors should store them in a dark, dry and cool place, and be patient.

“You can buy pu-er when it is young and inexpensive, and sell it for a high price when it matures over time,” says Chen. – The Straits Times, Singapore / Asia News Network

Newslinks (24.08.2007)

The price spiral of Pu'er tea

2007-08-24 China Economic Net

By Yang Qingxin, Zhou Bin

In the first half of 2007, the dealers and producers of Pu'er tea once experienced the "switchback."

The Yunnan spring tea continuously increased from about RMB20 or 30 yuan per kilogram at the beginning of 2007 to RMB60 to 70 yuan universally. The "Pu'er Seven Cake Tea" costing around RMB30 yuan was priced at RMB300 yuan to RMB500 yuan. From this May, the price began to drop, now the "Pu'er Seven Cake Tea" priced at RMB500 yuan can hardly be sold out.

Since 2000, Yunnan Pu'er tea gradually became popular in China, together with the price increased successively. Is the Pu'er Tea price empty high?

From 2005, some people worried that the Pu'er Tea price was abnormally high; some tea plants thought the price was too high, and did not dare to purchase. Unexpectedly, the tea price remained high in 2006. In the spring tea-picking period of 2007, the tea price did not drop, but rapidly increased by one time instead in comparison with that of 2006. The purchase price of famous spring teas of the six major tea mountains in Yunnan even astoundingly increased to about one thousand of RMB per kilogram.

In the harvest season of spring tea in 2007, the reporter visited Lincang -- one of the producing areas of big-leaf teas in Yunnan. At the time, Lincang was holding the 2007 Lincang Tea Culture Fair; the trading market was crowded with people conducting business busily.

But after May, the Pu'er Tea price began to drop. The "wind vane" of Pu'er Tea -- Pu'er Seven Cake Tea 7542 (Item No.) of Menghai Tea Plant continuously declined from RMB 22,000 yuan per piece in the middle March to around RMB8, 500 yuan in July 25th. It is learned that the varieties suffered serious decline in price recently were mainly the famous brands taking 70 percent market share, e.g. Dayi, Xiaguan and Zhongcha, the second-class brands were not influenced too much.

Mr. Liu Qun, the General Manager of Yunnan Mingzhong Tea Co., Ltd., told us that the market price exerted little influence to second-line enterprises. Under the precondition of ensured quality, the enterprise may reduce cost by blending technology and produce products accepted by the market. In addition, tea production and sales are of seasonal characteristics, the high season lasts from each October to the next April, it is normal that the spring tea (from the Spring Festival to April 25th) is more expensive than the rain water tea (after May).

Pu'er Tea is old crude tea or processed tea made from big-leaf sundried green tea after pile-fermentation, aging, drying and molding processes. The processed tea after artificial pile-fermentation, aging, drying and molding usually is about 40 percent higher than the crude tea in the year in terms of cost.

Professor Shao Wanfang, the President of the Tea School of Yunnan University of Agriculture introduced the three main characteristics of Pu'er Tea: First is its unique producing area -- the drainage area of Lancangjiang River in Yunnan; Second is the unique raw material -- the big-leaf sundried green tea in Yunnan, which generates large amount of beneficial bio-enzyme in fermentation; Third is the unique processing technology. Usually mature Pu'er Tea should undergo several processes as de-enzyming, twisting, drying and pile-fermentation. Across China, only the Yunnan processed Pu'er Tea adopts such producing technology.

What is the reasonable price interval of Pu'er Tea?

Mr. Liu Qun said the Pu'er Tea price differentiated because of different producing area, the key factor was the quality, for example, the first spring tea was priced at RMB120 yuan per kilogram on Bulang Mountain, Xishuangbanna in the fastigium this year, now it had dropped to RMB100 yuan per kilogram, but the relevant costs of tea production kept increasing.

Pu'er Tea is an excellent variety among all kinds of teas. The successively increased price is attributed to its unique functions. Mr. Gu Hangqi, the General Manager of Kunming Pulan Hexiang Tea Co., Ltd., believed that there were some rationalities for Pu'er Tea to increase price, but the increase should be within a reasonable scope. From another perspective, the price increase of Pu'er Tea in recent years is attributed to the long-term underestimation of its actual value. By 2000, the famous teas as West Lake dragon well, Anxi Tiekwan-yin, Dongting Lake Biluochun have broken RMB 1,000 per kilogram, but the Pu'er Tea was priced at RMB10 yuan to RMB20 yuan per kilogram only. Its special producing area and unique processing technology determined its difference from other teas; its incomparable health care function, the character of more time more spicy and profound historical and cultural connotation determined its investment value. Green tea can only embody its maximum value in the first year, in the next year things will be different, but Pu'er Tea is totally the contrary. Therefore, Mr. Gu Hangqi believed that top-quality Pu'er Tea could continue to increase in terms of price from long-term perspective, but this increase should be stable. Considering the storage and other factors, the increase rate better remained around 20 percent each year in a period.

The idea of stable price increase was accepted by some tea businessman and tea sippers from Kunming Kangle Tea House. During the interview, some relevant personnel said that it was very astonishing that the price of new tea increased by several times in 2007 in comparison with the sales in previous years, but vicious publication of Pu'er Tea was desirable.

Mr. Yang Shanxi, the Director of Yunnan Provincial Tea Office said that the price fluctuation in the first half of 2007 could be attributed to the factor of season, but mainly the deliberate publication by the dealers. At present, the value return is a necessity of market adjustment. Mr. Yang said, "Pu'er Tea is a kind of popular drink, which cannot be promoted as a kind of investment." He revealed that Pu'er Tea was not scarce commodity, and the yield of Yunnan had reached around 80,000 tons in 2006. From now on, Yunnan Province would give priority to support the 36 counties with annual tea output above 500 tons, accelerate the planning and construction of modern tea garden and promote organic and pollution-free production technology, as well as strictly restrict the use of fertilizer and pesticide. By 2010, the pollution-free tea gardens will reach 3.5 million mu.

Newslinks (27.06.2007)

The bubble bursts for Pu'er tea

By Olivia Chung, 27 June 2007, Online Asia Times

HONG KONG - Because of "excessive liquidity", or too much cash in circulation and in people's hands, not only stocks and housing but some unusual commodities can easily become items for speculation in today's China. 

Pu'er tea, a fully fermented variety made from sun-dried leaves, has taken a roller-coaster ride since the beginning of this year. 

Pu'er tea is reputed to help people lose weight. Some people believe it can even prevent and cure cancer. 

Many kinds of Chinese tea are best for consumption when they are fresh. Pu'er tea is different. The longer is it properly stored, the better its quality and taste (and supposedly its curative properties). Hence the price of older Pu'er is higher than the fresh ones. Such features make Pu'er a potential item for speculation. 

The popularity in Pu'er tea has been on the rise in China since 2004, and the prices grew steadily until last year, with annual increases of 30%. 

"Since the beginning of this year, the price of Pu'er has soared, reaching its peak in May at 20 times higher than last year's price. In terms of returns, Pu'er is a better investment than stocks or gold, isn't it?" a tea collector in Guangzhou said. 

"In the first four months of this year, the price of Pu'er rose three- to fourfold. That included fresh Pu'er that was marketed only last October; its price grew by 80%, to 1,600 yuan per kilogram from 900 yuan," the man said. "So although the prices of the Pu'er tea dropped suddenly early this month, many still believe it's only a matter of time before interest in the tea becomes stronger again." 

Wu Xirui, secretary general of the Chinese Tea Circulation Association, said the soaring prices of Pu'er tea, with a focus on such brands as Dayi, Haihe and Xiaguan, are a result of rampant speculation. 

"The main speculators are dealers from Guangzhou and Beijing. Neither are tea production areas but they have large tea wholesale markets," he said. 

Huang Jianzhang, secretary general of the tea culture research committee of the Guangdong Culture Study Group, said the average price of Pu'er soared to 800 yuan (US$105) per kilogram now from 8 yuan in 2004, as tea producers and merchants have bought up large stocks and are hoarding them, giving a false impression of a shortage to push up the prices. 

"Some speculators inflate prices by placing dummy bids and organizing promotional events like the selection of a 'tea king' to bang the drum for the potential high value of Pu'er tea. Immediately after real buyers arrive, the sellers will sell out," he said. "Just like the market manipulators on the stock market, tea speculators 'stir-fry' the tea by buying and selling it in a very short period." 

Industry experts also attributed the skyrocketing price to excessive liquidity, one of the key factors that have supported a bull run in China's stock and housing markets. 

When people have too much money with too few few investment channels and are feeling the pressure of rising living costs, people hope to make quick profits by speculating on Pu'er. 

Meanwhile, the skyrocketing price has caused people chasing short-term profits to produce more and more Pu'er, most of which is of low quality. 

In Yunnan province, the major producer of Pu'er tea, more than 3,000 enterprises are producing the tea, but only 59 have quality safety certificates issued by the government. Some small individually owned enterprises producing low-quality tea sell fake brands. 

The Pu'er craze is cause for concern in the tea industry. Wang Qing, vice chairman of the Chinese Tea Circulation Association, said a bubble has formed in the Pu'er market. The tea industry will formulate a code of self-discipline for the industry to guide the market by the end of this month, he said. 

Meanwhile, the soaring prices benefit the tea industrial chain, in which farmers can make a gross profit of 20%, tea factories can make 15% and dealers 100-200%, said Xi Zixiang, vice chairman of International Pu'er Tea Association. 

But he said tea shops might be the biggest potential victims of the rampant speculation. 

"Tea shops are like small investors who usually face the biggest investment risks in the speculative boom since their customers are tea drinkers, most of whom are price-sensitive, and there are a variety of choices for them to choose," he said. 

What goes up must come down, and this truism applies to tea. The Pu'er market saw its price drop 10-50% this month. 

A shop owner named Gao on Boyuan Road in Guangzhou complained that after her shop bought a carton of Pu'er tea for 3,000 yuan last month, its price dropped by several hundred yuan in slightly more than 30 days. 

Among the victims was a middle-aged man surnamed Zhang, who spent 400,000 yuan on Pu'er tea early last month. "The price went up a bit after a brief fall in mid-May. Then the prices kept going down. Now the stock is worth only 288,000 yuan," he said. 

"Never, ever believe any of the so-called insiders. One has to equip himself with knowledge about the tea before making an investment. Otherwise, someone like me is forced to be a collector," he said. 

In this tea-market mini-crash, the hardest-hit area is Guangzhou, where speculation on Pu'er tea outstripped stocks and property in the past four months. 

A senior manager surnamed Chen at a Guangzhou tea-trading company said there is a price but no buyers in the Pu'er tea market now. 

"The crash was caused by tea shops that began buying up large stocks estimated to reach more than 100,000 tonnes and hoarding them. That put part of them out in the market due to cash-flow problems," she said. 

"Besides, the stock market has recouped the losses during the sharp correction starting late May after the central government tripled the tax on shares transactions. Thus liquidity is flowing back into the stock market, so the price of Pu'er started to fall," she said. 

Others said some dealers who have faced the increasing costs put their stocks back on the market to protest the unreasonable price rise. 

Newslinks (24.06.2007)

Tea in China costs six times as much as gold

By David Eimer in Beijing

Last Updated: 12:30AM BST 24/06/2007

China's stock market may be booming and its house prices soaring, but the hottest investment in the country today comes in the shape of a small, compressed cake that smells vaguely earthy and is wrapped in paper.

Pu'er tea, a strong, aromatic brew from the remote south-western province of Yunnan, has long been prized in China for its medicinal qualities. Now, instead of drinking it, millions of Chinese are hoarding it after the price jumped 50 per cent last year.

Like fine wine, Pu'er tea is considered to improve as it ages. In 2005, 500g of 64-year-old Pu'er tea sold at auction for one million yuan (£66,300) - making it six times more expensive than gold.

The price has been rising since 2003, when investors in southern China and Hong Kong realised that, with a limited amount of tea grown each year, they could drive up its price by storing the tea rather than selling it.

Three weeks ago, an earthquake measuring 6.4 on the Richter scale hit the Pu'er tea-growing region, prompting fears of a shortage and causing a sharp increase in the price of the most recently produced tea - which, because of the lengthy fermentation process, might have been harvested up to two years ago.

At the Maliandao Tea Market in south-west Beijing, Pu'er is sold in 350g cakes which the vendors handle as gingerly as if they were rare antiques.

"The price of new tea has gone up 30 to 50 per cent since the earthquake," said Liu Na of the Che Yun Shan Tea Company.

A cake of two-year-old Ye Sheng Gucha tea costs 260 yuan (about £18), while the 13-year-old tea sells for 1,800 yuan. "It'll double in price in two years," said Mrs Liu.

Such returns are irresistible to a people in the grip of a speculating frenzy. Traditionally, the Chinese are savers, not spenders. But in April and May savings declined for the first time in four years, according to the People's Bank of China, as people sought to cash in on the stock and property markets.

Pu'er tea is seen by some as an even more attractive option.

"You don't have to pay tax when you sell your Pu'er tea," said Mrs Liu.

The red-coloured tea has a distinctive taste, much stronger than green tea. In the Huangshan Feng Tea Shop, the owner, Zhang Sheng Qin, held up a glass and swirled it around. "Good Pu'er tea should be transparent," she said.

"It's good for people who want to lose weight," she added. "Are there a lot of fat people in England? Maybe we can do some business."

Pu-Er Tea Daily Market Prices

Pu-Er tea is being traded daily and prices fluctuate depending on the type of tea, the quality of the tea, the age of the tea as well as the producing plant where the tea is originated. All these factors contribute to the fluctuation of the demand for the tea. Daily indicative prices can be obtained from the following site: www.puer001.com