11 February 2019

Kenya: Tea Earnings Hit Five-Year High on Increased Volumes

Tea farmers earned Sh140 billion last year boosted by high volumes that defied low international prices of the commodity in the market.

The earnings, which are the highest to be registered in the last five years, saw an increase of Sh11 billion to what was recorded in 2017.

Production reached a high of 474 million kilos in the review period, up from 415 million kilos exported in 2017.

The Tea Directorate, however, forecasts that the volumes will this year drop to 416 million kilos from a high of 474 million kilos realised last year.

The decline, says the directorate, will see the average auction price surge to Sh280 a kilo up from Sh260 achieved in 2018.

"Kenya tea production is expected to come to about 416 million kilos this year, down from what was produced in 2018, which is largely attributed to dynamics in the weather conditions in tea growing zones," says the directorate.

Local sales are expected to grow by five per cent to 40 million kilos, boosting the domestic earnings from the beverage to Sh18 billion compared with Sh16 billion earned last year.

The price of tea at the Mombasa auction has been on a decline since June 2017 when it stood at Sh230 a kilo to hit a four-year low at the moment.

In the weekly trading held last week at the Mombasa auction, a kilogramme of processed tea on average fetched Sh200 down from Sh270 on average in the corresponding period last year.

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