Nairobi — Tea prices have continued to decline at the tea auction falling below the minimum price of Shs 279 set by the Kenya Tea Development Agency (KTDA).
According to the East African Tea Trade Association, a kilo of tea sold at Sh 262 during the auction held last week an increase from Sh260.7 from the previous sale.
Although the minimum price is set for tea from KTDA, the decrease in prices has led to fewer sales at the auction as more traders withdraw the commodity.
This is the third month the value of tea has sold below the minimum price set by the Ministry of agriculture in June 2021.
During the previous sale, traders withdrew 4.7 million kilograms of tea with the unsold tea representing 34 percent of the total volumes offered for sale.
"There was a fair demand for the 189,600 packages (13.1 million kilos) for sale with 125,020 packages (8.3 million) kilos being sold," said Edward Mudibo, managing director at Eatta.
KTDA introduced a minimum reserve price of processed tea in a move aimed at cushioning smallholder farmers who were affected by the deteriorating market that had seen selling prices nearly slip below the cost of production.