Kenyan tea earnings impacted by the COVID-19 dropping by US$46.3m in the interim period

KENYA – Kenya’s earnings from tea in the first half of the year dropped to Ksh.55 billion (US$509.8m) from Ksh.60 billion (US$556.1m) recorded in the same period last year as demand was negatively impacted by the Covid-19 pandemic.

The Kenya Tea Directorate indicated that the low demand also led to the decline in price per kilo to Ksh221 (US$2.05) from Ksh239 (US$2.22) in the corresponding period last year, reports Business Daily.

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Volume of tea exported to the world market dropped by two million kilos in the six months to June, representing a one per cent decline.

Export to Kenya’s two major markets i.e. Pakistan and Egypt dropped by five per cent from each of the destinations.

Pakistan, which has been Kenya’s top buyer of the commodity for years, accounted for 32 per cent of the total volumes that were exported in the review period.

Egypt is the second top buyer of the Kenyan tea with UAE, Yemen and Afghanistan falling within the top ten purchasers of the beverage.

“Access to most markets is still a challenge due to the impact of Covid-19 on commodity distribution and trading across the globe,” said the directorate.

“Apart from supply disruption, the pandemic has also created global economic shocks thereby reducing consumer purchasing power,” added the regulator.

In efforts to cultivate robust and progressive tea regulations that will steer the tea industry well into the future, the government of Kenya recently unveiled the final draft of regulation that will govern activities around one of the country’s top export earner.

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The final draft of regulations seeks to improve the management of the tea value chain with a view to improving operational efficiencies of various actors and guarantee better earnings for the tea farmers.

Among the challenges that the reforms seek to eradicate include corruption, exploitation of farmers, conflict of interest in the management of tea value chain, diminished earnings for farmers, inefficiencies in the tea value chain, lack of transparency as well as the problem of low value addition of Kenyan tea destined for export.

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