TANZANIA – Tanzania recently held its first ever tea auction in Dar es Salaam, a move that is expected to increase fortune for the country’s tea subsector while posing a direct challenge to the Mombasa Tea Auction which until now was the only tea auction centre in East Africa.
The auction held at the Millennium Towers in Dar es Salaam was presided over by Tanzania’s Agriculture minister, Hussein M. Bashe.
Echoing the spirit of this significant venture, Bashe said, “It was a dream, but now we launch the first ever tea auction in Tanzania. It’s a journey that has been very difficult, filled with fear and many doubts.”
The auction platform features both Direct Market and Auction mechanisms in an effort to foster transparency and ensure fair pricing, thus protecting the interests of the hardworking farmers.
According to Mary Kipeja, Director general of the Tea Board of Tanzania (TBT), the new platform will make Tanzania a regional hub where tea producing countries with East Africa would be trading their produce at a more cost-sensitive alternative to the Mombasa tea auction.
“Players in the value chain including tea buyers, brokers, warehouse operators, and transporters among others will benefit from the auction. More Tanzanians will also be enticed with increased interests in tea cultivation and management in order to increase production and quality of produce,” she added.
Dar es Salaam and Tanga Port will be used for transportation of the auctioned tea, cutting about 50% of the initial transportation costs previously incurred in transporting the beverage produce to Mombasa for auction.
Ten processors are said to have signed contracts with brokers, while seven others are still under discussion before sealing the deal.
“The auction is going to significantly change the income of large- and small-scale growers because costs incurred for tea transporting to Mombasa in neighbouring Kenya will now be used for strengthening and improving productivity,” said Ms Kipeja.
The launch of the online tea auction platform comes in time when the global prices for the commodity are facing a downtrend.
Tea production in the country has also been stagnant, with production in 2022/23 season recording an all-time low of 7,875 tonnes.
According to a report by Bashe, revenue collected from tea production and auction in 2019/20 was US$34.248 million, US$39.001million in 2020/21, US$34.589 million in 2021/22, and US$12.24 million in 2022/23.
Earlier, Bashe announced the 10 Year Tea Industry Strategy that aimed at increasing dry tea production from 33,000 tonnes to 90,000 tonnes by 2029/30.