In Britain, 96 percent of the tea bought is bought in bags, up from under 3 percent as recently as the early 1960s, according to the UK Tea & Infusions Association's own account of the format's rise. That shift was not a change in what tea is. It was a change in who could afford to pack it, at what speed, and in what material, and none of the three decisions that drove it were made in a tea garden. The tea bag is the one place in this trade where the single biggest choice in the whole value chain, sealed sachet or loose leaf, was settled by a manufacturer, and the machine that made that choice cheap still decides, a century later, who captures the margin on a cup of tea.

An accident that needed a machine to become an industry

The tea bag's origin story is a shipping economy, not a brewing insight. Around 1908, the New York tea and coffee importer Thomas Sullivan began mailing sample tea to buyers in small silk pouches to save the cost of tins, and customers, assuming the pouch was meant to be dropped straight into the pot, brewed it whole rather than emptying it first. A fabric patent for an infuser bag had already been filed a few years earlier by two Milwaukee inventors, Roberta Lawson and Mary Molaren, but it was Sullivan's accident, and the demand it created, that put the idea into commercial motion.

An accident does not scale on its own. That took a purpose-built machine, and the machine came from Germany. In 1928 the German tea packer Teekanne brought to production the Pompadour, described in the company's own history as the world's first tea bag packing machine, capable of producing 35 gauze sachets a minute entirely automatically, engineered by Teekanne's Adolf Rambold. A hand-folded sachet was a novelty item; a machine that could fold, fill, and seal 35 of them in the time it took to say so was the beginning of an industry, because it was the first point at which a packer could sell bagged tea at a price a loose-leaf buyer would also pay.

The throughput kept climbing, and the unit cost kept falling

What happened next is a straight manufacturing story, and the figures Teekanne itself publishes trace it cleanly. Rambold's next machine, the Constanta, reached the market in 1949 and produced up to 160 bags a minute, in the newly folded double-chamber shape that let water circulate on both sides of the leaf, a more than fourfold jump in twenty years. By 1990 Teekanne's Perfecta line had reached 400 double-chamber bags a minute. As of 2026, commercial lines have kept climbing on the same curve: IMA's C24-E model runs up to 400 bags a minute, and its highest-throughput model, the C51, is rated at up to 2,000 bags a minute, more than fiftyfold the Pompadour's 1928 rate.

That climb matters because packing, not growing, is where a bag's per-unit cost is actually won or lost. A garden's cost per kilogram of leaf does not fall meaningfully because a packing line downstream runs faster; the leaf still has to be plucked, withered, and processed the same way regardless of what container it ends up in. What a faster machine buys the packer is a lower labour and overhead cost per bag, spread across a run that can now fill a supermarket's weekly order in hours rather than days. The tea bag became cheap enough to undercut loose leaf on price, and stay profitable to the packer, because the packing step, not the crop, kept getting faster.

Britain took half a century to follow the machine

Having the machine did not mean the market moved overnight, and Britain's own adoption curve shows the lag plainly. Tetley introduced the tea bag to the British market in 1953, but the UK Tea & Infusions Association's figures show tea bags still held less than 3 percent of the British market through the early 1960s, before eventually reaching a "phenomenal" 96 percent by 2007. Britain had the machine capacity to bag tea from the mid-1950s onward. What it lacked, for a decade and more after Tetley's launch, was a generation of buyers willing to abandon a loose-leaf habit, and packers willing to build out national bagging capacity before the demand was proven. The technology was never the bottleneck; the retail habit was, and once a critical mass of shoppers switched, the remaining loose-leaf market collapsed fast, because a packer already running a bagging line at scale could always undercut a smaller rival still selling loose.

The capital sits at the packing line, not the garden

A high-speed bagging line is also a barrier to entry, and that barrier falls on the packer, not the grower. Running a machine rated at hundreds or thousands of bags a minute only pays for itself at national or export volume, which is why the tea bag market is dominated by a small number of large blenders (Unilever's former tea business, now ekaterra, Tata Consumer, and a handful of others) with the capital to keep such lines running continuously, rather than by the thousands of individual gardens that actually grow the leaf. The bagging decision also reaches back into the factory that dries and sorts the leaf in the first place: a machine built to fill a small paper sachet in a fraction of a second needs a uniform, free-flowing granule, which is exactly what CTC (Cut, Tear, Curl) manufacture is built to produce and what this publication has covered as its own separate economic story in what a tea grade actually means. The grower's leaf, the factory's processing choice, and the packer's machine are three separate cost decisions, made by three different actors, and the tea bag is the point where all three have to line up before a single sachet reaches a shelf.

Germany shows the bag's dominance was never inevitable

Britain's 96 percent looks like the natural endpoint of the format, but Germany's own market figures show it is not. The Deutscher Tee & Kräutertee Verband, Germany's tea trade association, reported in its 2022 Teereport (covering 2021 market data) that tea bags accounted for about 90 percent of fruit and herbal tea sales but only around 55 percent of sales of true tea, black and green, with loose leaf still holding close to half that segment. Herbal and fruit blends are, by their nature, already commodity mixtures with no single-origin story to sell loose; true tea, in a market with a stronger specialty and loose-leaf retail culture than Britain's, has resisted full conversion to the bag even after a century of machines built to fill one. The format a country settles on is a retail-structure outcome, not a fact about the plant, and it can land anywhere between Britain's near-total conversion and Germany's roughly even split depending on how that country's tea trade grew up.

The newest line item in the cost stack is the bag itself

The material question that opened this history, silk, then gauze, then paper, is not settled either, and as of 2026 it remains the tea bag's most active cost dispute. Researchers at McGill University reported in Environmental Science & Technology in 2019 that a single plastic tea bag, steeped at brewing temperature, released roughly 11.6 billion microplastic and 3.1 billion nanoplastic particles into the water. The finding, following a 38 Degrees petition that passed 200,000 signatures, pushed Unilever's PG Tips, which makes 10 billion tea bags a year, to announce in February 2018 that it would move its pyramid bags to a plant-based, biodegradable material. Several other major brands have since followed. But the switch has not closed the question the way the headlines suggest: independent testing tracked by the consumer group Ethical Consumer finds that some major brands still seal ordinary paper bags with a thermoplastic fibre, and that PLA (polylactic acid, a corn-starch-derived bioplastic), the plant-based material replacing plastic in pyramid bags, is usually compostable only in an industrial facility, not in a home compost bin. A material switch driven by a viral figure has not yet produced a single clean standard; it has produced a second cost line, material and disposal, sitting on top of the packing-speed economics that built the format in the first place.

The bottom line

From Sullivan's silk sachet to a modern line running close to 2,000 bags a minute, every advance that made the tea bag cheap moved the decision that mattered, and the cost that came with it, further from the garden and closer to the packer. The leaf inside barely changed; the machine wrapping it did, six decades of throughput gains turning a shipping accident into the format most of the world now drinks from. Germany's own market shows that outcome was never automatic, and the current dispute over what the bag itself is made of shows the economics are still moving. A reader who wants the upstream half of this story, how the leaf gets sorted into the fine, fast-infusing grade a bagging line actually needs, should read What Does a Tea Grade Actually Mean?, and a reader asking who besides the packer takes a cut on the way to that bag should read Who Makes Money From a Cup of Tea?