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Kenya: Farmers Reap Benefits of Fair Trade Teas
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Business Daily (Nairobi)
5 May 2008
Posted to the web 5 May 2008
Solomon Mburu
Boosted by increased demand for fair trade certified products in international markets, Kenya's tea sector is now turning to the fair trade movement to increase revenue.
In the last one year, seven tea factories allied to the Kenya Tea Development Authority (KTDA) have entered the certification programme.
This brings to 10 factories in the country which are certified with the fair trade label. To date, Kenyan tea farmers have earned about Sh224 million from the certification, which started four years ago.
The new wave of interest in fair trade teas has been driven by increased demand from the international markets, especially the UK. For example in Australia, consumers spent $11.7 million on fair trade products last year and are expected to spend $20 million this year.
The demand has been pushed by an increasing need by consumers to help struggling producers in developing countries. Fair trade is a market-based method of alleviating global poverty through empowering producers in developing nations.
The movement seeks to increase incomes of small-scale producers by adding premiums on the conventional market price. Consumers in developed countries buy products at the increased prices with the aim of ensuring sustainability.
Transparency created in the value chain through regular audits ensures that the premiums get to the intended recipients and are used for community development.
International tea buyers- Finleys, Kaffe Direct, Varees, Rinttons and Thomson Brownie - are the main buyers of the certified teas from Kenya .
According to Terry Nyambura, the fair trade co-ordinator at KTDA, for every kilogramme of certified tea, a Kenyan farmer is given a premium of Sh31 ($0.50), which is paid above the conventional market price.
"This new development is market driven since the buyers are the ones demanding that certain factories be put on certification," said Ms Nyambura.
The market for fair trade products has increased in the recent past, forcing the buyers to identify high quality tea producing factories for inclusion in the certification programme.
Factories that have recently joined the certification movement include; Iriaini and Chinga tea factories in Othaya, Kanyenya-ini in Murang'a, Ndima in Kirinyaga, Rukuriri in Embu, Imenti in Meru Central and Mechie Mekuru in Nyambene.
Makomboki and Gacharage tea factories in Murang'a have been in the fair trade programme for two years while the oldest has been Keigoi in Maua which has had the certification for four years. Keigoi Tea Factory which is the oldest in the scheme has earned Sh120 million in premiums so far.
Mokomboki and Gacharage factories have earned premiums worth Sh35 million and Sh32 million respectively in a period of two years.
Imenti factory in Meru Central and Mechie Mekuru in Nyambene have each earned Sh6 million while the Kanyenyaini factory in Muranga and Chinga factory in Othaya have each earned Sh2.5 million.
Iriaini factory in Othaya has earned Sh3 million while Ndima in Kirinyaga and Rukuriri in Embu have each earned Sh1 million from the scheme.
The new development presents tea farmers with an opportunity to increase revenue through value addition. This follows stagnation of global tea prices in the international market due to a tea glut which is now forcing farmers to seek other options.
Despite the scheme being introduced in the country about five years ago, farmers embraced the concept in 2006.
"Most of the new entrants have acquired certification in the period between October 2006 and November 2007," said Mathew Ng'enda, the manager of Iriaini Tea Factory, which has been trading in certified tea for the last eight months.
According to Mr Ng'enda, most farmers were not aware of the benefits of the programme.
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But since 2006, KTDA embarked on a programme aimed at educating farmers on importance of the certification. To get the fair trade certificates, farmers are required to meet a set of standards.
The certifying bodies, which include Forest Alliance, Bureau Veritas and Ethico Partnership, require farmers to promote ethical and environmental standards. The factories are supposed to be clean and ensure good working conditions.
"We need to keep improving on the environment and ensure that no child workers are used and that labourers are not exploited."
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