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Wednesday, January 23, 2019

Puerh Trends We Need to Thrive in 2019


2019 promises another busy puerh year for most buyers, judging from the pure frenzy of Black Friday buying last fall. You need to be quick these days when contemplating a purchase, don’t think too long because whatever you’re staring at might be sold out within seconds. Last year’s buying certainly suggests some wishful ideas and perhaps stark reality. Let’s consider some trends we need versus the probable reality.

What we need: more $100 and under options.

What we will get: more tiny tongs.

What I see with these tiny tongs is that nobody actually wants a producer to make these, no one wants tiny tongs as the only affordable option. Yet when I look at social media and see pics of puerh hauls, the tiny tongs are everywhere. People tack them on to a purchase of something else, and honestly half the time the tiny tongs are not the main buying plan. But vendors benefit here, and they have smaller quantities of nice tea that will not fill out a full size production, so why not make minis when they sell well?

What we need: more semi-aged teas in vendor shops.

What we will get: more buyer-led group buys.

The fact is, semi-aged tea is barely worth the time of a profit vendor to scout out and sell. The profit margin just isn’t there. Any good tea is still pricey enough wholesale. Anyone who has a good tea usually knows what they have. So the vendor is not getting a decent enough steal to make the same margin as with newer, young tea. More and more people are going to rely on tea heads to middleman scout on Taobao and elsewhere. Still plenty of space for LP buys, Teas We Like, An Adventure in Every Cup etc. to bring semi-aged teas to buyers. The market is there, but the profits generally are not, the middleman does it for love.

What we need: teas with body feels.

What we will get: weed in tea, teas with body feels.

I think the goosh-only phase got a dose of reality over the past few years. Gushu gets slapped on a lot of teas that aren’t, and gushu doesn’t necessarily mean ethereal level tea anymore even when genuine. So much overpicking going on, and too few truly pristine, untouched tea areas accessible to any of us. We do have an abundance of cheap weed, according to a recent Vice report, Oregon is awash in cheap weed because of issuing a license to just about anybody wanting to grow. The next logical step is add that cheap weed to tea and amp up the tea crowd and the weed crowd. I wonder how many people would even notice bits of crumbled weed in a beengcha.

Having said that, I think vendors will deliver on the body feels even without the weed. White2tea certainly delivered in 2018 in Feng Qing Arbor Red and White, and for a price point under $100 such that you can buy your puerh and get your body feels too.

What we need: premium shou.

What we will get: premium shou.

Over the past few years we saw a few vendors hitting shops with 40 cents/g and up for tippy, premium shou tea. People like premium, they like clean shou and are willing to pay. While premium, gift quality shou has been around forever in China, western buyers are probably more receptive to western vendors due to cleanliness notions, meaning no funky off-flavors, no storage odors or flavors, tiny tippy leaves. Maybe premium shou will get downsized into tiny tongs rather than upsized, but the buyers are there for clean and pricey shou. Unlike sheng, shou is consumed quickly by comparison leaving the buyer hunting for refills. I think vendors are going to deliver on this trend.

What we need: affordable sheng.

What we will get: white tea and red tea.

I see these teas flying off shelves in part because they are beginner friendly in profile. White and red teas are also ways to sell less expensive maocha. Vendors are delivering on this trend and with pretty wrappers. I expect a lot more Yunnan whites and reds this year. I doubt maocha prices for the good sheng puerh teas will improve much, unless we have such an awful weather year the quality is poor.
 

What we need: Taetea collector prices to fall.

What we will get: more Taetea special productions.

The reason behind the price flurries of recent years is the real estate market in China has taken a bit of a nosedive. Real estate is one of the few investments middle class persons have for their cash. Collectibles pick up a bit when real estate falls, such as tea which can be unloaded quickly by comparison with real estate. I don’t know if the price will fall in the collector tea area this year, especially if real estate stays flat and currency flattens more. I am seeing more tongs up for trade though on Facebook, maybe people are getting nervous. 

In any collector market, a situation where everyone crazes over too many productions, eventually the best and most desirable bear the price falls of less desirable items. In order for the cream to rise to the top, the low end needs to drop out. Taetea has too many productions starting retail at over $100/beeng, and like used cars  leaving the dealer lot, the price drops to half in retail price cutting. The market gets confusing as to which productions are really worth not only their starting retail, but perhaps more as the run sells out. Right now we are in the midst of this confusion, and perhaps this is the year when we start to see a real distinction of low end from high end. Honestly, a lot of these beengs are the same old chopped tea with very little to distinguish one from another aside from the wrapper design.

I would be very, very wary of jumping into collector beengs that are not part of a drinking plan. Taetea is surely still on the boutique tea upswing, we will likely see more special productions starting in the over $100/beeng retail range as long as people continue to buy like crazy.

What we need: few predictions and more tea reality.

What we will get: more speculation.

You can count on this one.

3 comments:

  1. Yah, DaYi has gotten too crazy for me lately as have a lot of new stuff. I am searching the aged versions out at good pricing when I can. When will that bubble pop again......

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  2. Cwyn N,

    Great blog. I think you are right in your assessment of the continuing ridiculous price rise of new pu’erh. I just cannot see how it can be sustained Indefinitely. I have stuck most of my tea purchases over the past several years to semi aged teas from various sources as as a result. Ironically, I have bought some new tea cakes this past year ... White tea.

    Regards,

    ReplyDelete

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