Uganda constructs US$2.37m tea factories under Uganda Development Corporation

UGANDA – Ugandan government under its investment arm, Uganda Development Corporation (UDC) has established two tea factories valued at a cost of US$2.37 million.

The Monitor reported the move is part of government’s plan to promote value addition in an attempt to align the agro sector to the National Export Development Strategy and National Development Plan II.

Tea is an important crop in Uganda as it is used as a cash crop for small farmers, creates employment and foreign exchange earner being an important export product.

The government had signed a comprehensive lease financing agreement with Kigezi Highland Tea to procure, install and commission a 450 kilogrammes per hour capacity production lines.

“We procured a contractor to supply, install and operationalise the tea processing lines, install and commission electrical works and supply and install two 500KVA power generators at both factories,” said Mr Emmanuel Mutahunga, the UDC acting executive director

According to him, already, Kabale Tea Factory has been completed and is now operational though it is currently undergoing a trial phase of three months that started in May and will end next month.

On average, the factory receives 12,000 kilogrammes of green leaf daily and currently employs 75 people with the prospect of multiplying the number when fully operational.

Kisoro Tea Factory, which the Ministry of Trade said was working on, was expected to be completed at the close of this year.

The factories, once fully operational, according to the Ministry of Trade, will produce a combined total of 2,400 metric tonnes of ready-made tea per year worth $4.8m in export earnings.

Uganda produces 61,629 metric tonnes of tea annually valued at US$80.6 million (contributing 1.6% in global tea trade) with 90% of this exported through the Mombasa Tea Auction.

Global trade in tea stands at an average of around US$5b per annum and has been steadily increasing partly due to a change in the beverage consumption habits worldwide.

Tea production nationwide by area stands at 28,000 hectares with an output of 60,000 metric tonnes reflecting 18% of Uganda’s potential in terms of tea production.

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