KENYA – Kenya’s tea sector has received a major boost as tea prices at the Mombasa auction surged 29.1 percent to Kes443 (US$3.41) per kilogram in February.
The increase in prices has been attributed to an increase in global demand for the beverage marking a major boost for the green leaf which fetched US$2.64 during the same period in 2023.
The Central Bank of Kenya (CBK) has since tipped Kenya to increase the quantity of tea exports revealing that traditional importers such as Europe and North America have increased their demand for the country’s major export.
While making a presentation to the budget and appropriations committee, Kamau Thugge, Governer CBK, said: “Positive prospects for improved tea exports in 2024 on account of the pick-up in global tea prices.”
The higher tea prices recorded come on the heels of a stellar performance by the tea sector in 2023, with exports for the green leaf recording a 16 percent rise to 522.92 kilograms.
Latest data from the Kenya Tea Board of Kenya (TBK) indicates that total earnings from tea exports last year increased by Kes42.5 billion (US$326.92) from Kes138.1 billion (US$1.06B) reported in 2022 as the industry also enjoyed stable prices.
“This represented a 31pc increase in value of exports and is the best earnings ever recorded by the tea industry over the years,” said TBK.
According to the Food and Agriculture Organisation (FAO), global tea consumption expanded by 2 percent in 2022 compared to 2021, further increasing in 2023 as demand in the market continues to grow.
As a result, farmers affiliated with 54 factories under the Kenya Tea Development Agency (KTDA) received a record bonus payment of Kes 44.15 billion (US$339.62M) for the period to June 2023.
The agency also released Kes23.55 billion (US181.15M) as monthly pay for green leaf supplied to the factories, bringing the total earnings to a sum of Kes67.7 billion (US$520.77M) for the financial year ending June 30, 2023.
Meanwhile, the tea manufacturing sector is spearheading a technological revolution in the sector aiming to reduce production costs and climate change.
The revolution, led by the Tea Machinery and Engineering Company (TEMEC) is set to develop and implement energy-efficient machinery to address challenges posed by climate change.
TEMEC is also supporting smallholder tea farmers through the mechanization of tea plucking aimed at helping farmers manage production costs while maintaining tea quality.
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