7 October 2018

Kenya: Sweet Scent Brewing in Kenyan Tea Cup, Earnings Reach Sh85.74 Billion

Kenya tea farmers are a happier lot than last year as earnings from their crop increased by almost 10 per cent in the last year buoyed by a good climate for local production which translated to more volume of tea.

Kenya Tea Development Agency, the body responsible for the well-being of the crop has published yearly report indicating that farmers have earned a record gross payment of Sh85.74 billion. Last season's total income was Sh78.31 billion.

In January 2018, the amount of black tea offered at the Mombasa tea auction increased by a massive 800,000 kilos compared to the previous month. As a matter of fact, the volume of tea traded in the first week of 2018 was almost 2 million kilos more than a similar period in 2017.

The increase in the amount traded has also had a significant effect on the price of tea traded resulting to more earning for Kenyan farmers. The high production has been attributed to conducive weather conditions in the producing areas as well as an end to industrial unrest that faced the production in 2016 and 2017.

Statistics also from the Auction have shown that there is increased demand for Kenyan tea mainly from Egypt, Pakistan and Iran which has sent shivers among key competitors mainly India whose tea is popular in the UK and US.

The rise of China as a key tea buying country has also increased the demand for Kenyan tea and hence raising the price of the commodity. Kenya has also been mending its trade relationship with European buyers led by UK.

The planned direct flights from Nairobi to the US is also expected to boost the trading of tea to the Americas and be in direct competition with South American teas.

A kilogramme of green leaf fetched an average of Sh52.51 in the last season, having dropped from Sh58.61 in 2017. The payout represents a return of 73 per cent of the total tea revenue, the remaining 27 per cent having gone to "covering various costs of production," KTDA said.


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