Catherine Riungu
15 June 2008
Nairobi — After suffering its steepest drop in production ever, Kenya's tea industry has recovered marginally thanks to the onset of the long rains.
The Tea Board of Kenya says the April harvest was 27.4 million kg compared with 16.9 million Kg registered in March and 24 million Kg recorded in February.
Despite the improvement, output for the month under review was still 10 per cent lower compared with the 30.6 million Kg registered during the same month last year, due to depressed and poorly distributed rainfall in most parts of the country, the board says in a new report.
As a result of decreased rainfall in April and dry weather conditions experienced during the January-March season, cumulative production for the period dropped by 29 per cent from 139.3 million Kg registered during the same period last year, to 98.1 million Kg, the lowest recorded in the history of the sector.
During the month, some 25.5 million Kg of tea was offered for sale at the Mombasa Auctions, a 45 per cent increase compared with the 17.6 million offered in March and 9 per cent higher than the 23.3 million kg offered in April 2007.
Also improved was the average unit price for tea, which stood at $2.31 per kg compared with the $2.23 recorded in March this year and $1.65 recorded in the same period last year.
As a result of increased auction supplies, the volume of tea exported in April increased by 48 per cent to 35.2 million kg from 23.8 million kg recorded in March and 18 per cent compared with 29.8 million kg recorded in April last year. Buyers were reported to be purchasing more as reports emerged that Kenya was producing less tea.
During the period under review, tea was exported to 35 market destinations world-wide compared with 31 destinations during the same period last year.
Egypt was the leading export destination, having imported 13.6 million kg, which accounted for 39 per cent of the total export volume. Other key markets include the UK, which imported 4.5 million kg; Pakistan (3.5 million kg); Sudan (3.3 million kg) and Afghanistan (2 million kg).
The five markets accounted for 77 per cent of total export volume and the rest accounted for 23 per cent.
Among the five traditional markets for Kenyan tea, Egypt registered the highest growth of 65 per cent compared with the same period last year. Sudan and the UK registered a growth of 63 per cent and 43 per cent respectively.
Among the non-traditional markets, Nigeria recorded the highest growth of 615 per cent. Other non-traditional markets that recorded significant growth were the Netherlands (324 per cent); Poland (214 per cent); Turkey (212 per cent) and Oman (179 per cent).
Major markets that registered decline in tea export volumes compared with the same period last year were Puerto Rico (85 per cent); Saudi Arabia (68 per cent); US (48 per cent), Ireland (46 cent), Pakistan (41 per cent), Afghanistan (34 per cent) and Russia (32 per cent).
The drop in exports to these destinations was occasioned by reduced demand, particularly within the lower-end market segment, due to increased prices. However, this drop is seasonal and demand is expected to rise soon following increased supplies occasioned by recovery of the industry from the effects of drought, said TBK managing director Sicily Kariuki.
Local consumption rose to 1.5 million Kg, an increase of 34 per cent compared with 1.1 million Kg recorded in March and 6 per cent compared to 1.4 million Kg recorded in April 2007. Local tea consumption for the period of January-April 2008 stood at 5 million Kg, 4 per cent lower compared to 5.1 million Kg recorded during the same period in 2007.
The drop in local tea consumption was attributed to shift in preference towards cold beverages during the first three months of the year owing hot weather conditions.
To address the issue of depressed local tea consumption in the long-term, the industry is now repositioning tea as both an indoor and outdoor drink which can be taken any time, hot or cold besides having refreshing, natural and healthy attributes- a move being led by Kenya Tea Packers with their recent introduction of bottled Ready-to-Drink teas in the local market.
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