Muchiri Gitonga
15 November 2009
Nairobi — The Kenya Tea Development Agency is in plans to increase the price of initial payment for green leaf tea from Sh10.50 to Sh12 per kilogramme. A director of the small-scale tea management firm's board, Mr Peter Kanyago, said the new payment will become effective from January next year.
"KTDA will continue looking for ways to pass on better payments to farmers and even next year we hope to pay a better bonus since auction prices have been good. The prices could, however, come down due to the rains which could boost production," he said at the weekend during a farmers' field day in Othaya.
Mr Kanyago defended the move by the firm to start a micro-finance institution, Greenland Fedha, saying it was meant to bring services closer to the farmers. The agency, he said, is already negotiating with a financial institution to open automated teller machines in tea factories for farmers.
"Some people are moving around saying the micro-finance institution will kill saccos. We are not competing with the saccos but complimenting their services," he said.
Last week, Co-operatives Development and Marketing minister Joseph Nyaga, had said he would not allow the new institution to kill the savings and credit societies, adding that KTDA does not have its own money since the Sh160 million it intended to use as initial capital, belongs to farmers.
He urged the agency to release the money to the farmers and concentrate on its core business. However, Mr Kanyago said that by starting the micro-finance institution, the KTDA was diversifying its income so that it can pay farmers better.
Rainforest award
Elsewhere, Momul Tea Factory Company has become the first small-holder tea factory in the world to be awarded the Rainforest Alliance certification award. The KTDA-managed factory in Kericho West District will now sell tea at a premium in the international market and the increased income passed on to the small-scale farmers who are its shareholders.
While receiving the certificate on Sunday at the factory grounds, KTDA national vice chairman, Mr Philip Ngetich, said the award marks a milestone in the tea industry. He said Rainforest Alliance Certification will enable farmers to produce tea in a sustainable manner and register increased earnings in the long term.
Rainforest Alliance requires that farmers protect the natural forests within their jurisdiction and plant indigenous trees to boost forest cover. It also obligates farmers and factories to produce tea ethically by avoiding child labour and protecting the health of workers both at the farm and factory levels.
Mr Ngetich said Momul was chosen from among the four factories which had been put on a pilot project by the Rainforest Alliance for certification. Momul is one of the youngest factories of the 63 factories managed by KTDA that serve the small scale holder tea sub-sector and has a capacity to process 15 million kilogrammes of green leaf annually.
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