The cultivated plots of Wulongshan tea garden are located in a radius of 30 kilometres around the county town of Wuyuan in the province of Jiangxi in southeast China. The district of Wuyuan has 337.000 inhabitants and a rural character. There are no important industrial companies. White painted stone houses with black roofs characterise the villages.

The individual tea gardens are 5 to 28 hectares and are located at an altitude of 100 to 600 metres above sea level. Currently, six organic certified tea gardens belong to Wulongshan. One more plot is in conversion to organic farming.

Today around 500 people in 130 households live in the villages near the already organic certified tea gardens. The formerly independent small farmers have received a free lifelong right to use a small area of the tea gardens from the state, a kind of leasehold, which is inherited in the family. Traditionally, up to three generations lived under one roof: grandparents, one to two parents and one or two children.

After China's great economic success, the situation in the countryside has changed. Today there are hardly any young adults in the villages, almost only older people from 55 years of age. Young adults often live and work far away in the cities, as there are better earning opportunities and a more interesting life for them. In the villages today, mostly grandparents live together with their grandchildren. The parents who work far away often see their children only once a year for the Chinese New Year (Spring Festival), when all the Chinese visit their home villages. The villagers are essentially self-sufficient, cultivate vegetables, rice and rape for their own needs, keep one or two pigs, goats and chickens, go fishing and perform other activities to earn some money. They lease their leasehold part of the tea garden to the company Wulongshan.

There is a nine-year compulsory education in China. In the villages with more than 100 households there are usually elementary schools for the first to third class. These schools are within a radius of ten kilometres and can be reached daily by all students. The older students of the fourth to ninth class attend boarding schools in the town. These students spend the workdays at the boarding school and are at home with their grandparents at the weekend. School attendance up to ninth class is free. Parents only pay for teaching materials and books. Secondary schools or university studies have to be paid for and were unaffordable for most rural families just a few years ago. Today, families have income because the young work in the city and the old in the tea farms, for example. These families can afford to send 1-2 children to secondary schools or even to study.

The farmers who have leased their land to the company Wulongshan have signed a contract with a duration of 25 years and receive an annual rent from 750 to 2250 RMB (95 to 290 euro) per hectare. The lease agreements were concluded between the farmers, the respective municipal administration and the company Wulongshan. The older the lease contracts are, the lower the rent, which is determined by the authorities. In the case an expiring lease agreement has to be extended, the lease amounts increase significantly.

For the peasants, the leasing of their cultivated land offers various advantages: Independent small farmers have little rights in China and are often exploited by the local traders who buy their tea. When leasing their cultivated land, the farmers enter into an employment relationship with the company Wulongshan. Chinese companies are required by law to complete an employment contract with every single employee. As contract workers of a company such as Wulongshan, the former independent smallholder farmers have a legal right to compliance with Chinese labour law, which applies equally to permanent and short-term employees. You can find more information on this in our text on labour law and social laws in China.

The company Wulongshan complies with the legal regulations. The wages paid are above the legal minimum wage.

Wulongshan only employs people from the surrounding villages where the already certified organic tea gardens are located. Most of the employees are between 55 and 65 years old. Of the 200 employees, 25 have a permanent employment contract. They are paid well above the legal minimum wage (between 3000 and 3500 yuan or about 405 to 473 euros per month). 175 workers have seasonal fixed-term contracts. They are paid between 90 and 120 yuan per day (about 12 to 16 euros) or 1980 to 2640 yuan for 22 working days per month (about 267 to 357 euros), which is also above the legal minimum wage. 

Seasonal workers can be employed only a few days, a few weeks or months to prepare the cultivated areas and/or for tea harvesting and tea processing. To them the same monthly minimum wage applies as to full-time workers.

If one calculates their lease income for the tea fields and wages together, seasonal employed former small farmers receive in a six-month period of employment an annualised monthly income of 150 to 200 euro. Given that these farmers are often self-sufficient, do not have to pay rent and perform additional paid activities, their income may add up to a pretty penny. In addition, they have the advantage of social security: a pension, health and accident insurance coverage as well as the entitlement to compliance with statutory labour law. The income that people could earn from selling their tea as self-employed smallholders was uncertain and, depending on the achieved price of tea, could be significantly lower than what they receive as employees at Wulongshan. 

The described employment model for former small-scale farmers in China contributes significantly to complying with the rules of the EU regulation on organic production and thus to sustainability and consumer protection in Europe.

With the conclusion of the lease contracts, the company Wulongshan has assumed responsibility for the correct implementation of the ecological process. Trained managers control compliance with the prescribed rules in both agriculture and tea processing. The development partnership with Fairbiotea supports the sustainable development in the field of ecology, social affairs and economy. This includes the development of an ecological nutrient cycle, species and nature conservation, fair working conditions for employees and the development of more economic viability as a basis for the financing of sustainable measures. In addition, hygiene and quality management systems, sustainability certifications and the implementation of their content also belong to the development plan as well as the declared willingness for a close cooperation between Wulongshan, Fairbiotea and the responsible control body (for enhanced security controls and for monitoring the compliance with the development plan).

The company Wulongshan is also responsible for compliance with the EU food law regulations. It may need to take corrective measures and invest in order to be able to comply with EU regulations at all times.

Wulongshan has two modern preprocessing factories. One factory has been built and put into operation in the year 2018. For the processing in this factory electricity, gas and diesel are used. The other was built in 2022 in the premises of the final processing factory and uses electricity, gas and pellets for the machines. Fuel such as firewood or coal is not used. This prevents contamination of the tea with harmful combustion residues in the manufacturing process. In addition to the preprocessing factories, there is a central final processing factory for the standardisation and cleaning of the teas. Trained personnel are employed in all factories.

For smallholder farms, such management, sustainable development, bio-security and the necessary investments are not feasible.

Updated 2 May 2023