Tanzania unveils plans of setting up local tea auction to boost sector

TANZANIA – Tanzania Mercantile Exchange (TMX), a Tanzanian commodity exchange platform for global and domestic markets, has unveiled plans of opening a local tea auction in the country in a bid to boost the sector, reports Daily News.

According to Mr Godfrey Malekano, Chief Executive Officer at TMX, said that the initiative will also help relocate the country’s tea action operations from Kenya’s Mombasa Tea Auction and offer farmers better deals.

Additionally, Mr Malekano said that the local tea auction will also boost farmers’ earnings and government revenue as well as retaining the identity of the local produced tea.

“We have deployed a team of experts to all tea producing areas to sort out some critical issues that may hamper smooth fast track of the tea auction in the country,” he said.

According to Mr Malekano, the country is eyeing the traditional European and China markets who have become new and important markets with huge demand for tea from the East African producers.

He said discussions with key stakeholders in the tea industry have been held and paved the way for the take-off of the tea auction market in Dar es Salaam.

He said setting up of warehouses for tea storage is on card as well as other infrastructure improvements with expectation of fetching high prices than when the local produced tea is sold through Mombasa auction.

This comes at a time when tea industry players in Uganda and Tanzania have been pushing to exit the Mombasa auction and establish own tea auction markets as they seek to induce competition and open up global tea market access.  

Tea is among five leading cash crops in Tanzania with more than 30,000 smallholder farmers who collectively produce a third of the country’s output.

Unlike its East African counterpart, Tanzania tea sector is majorly dominated by commercial plantations cultivating 11,272 hectares while small holder farmers have about 11,445 hectares.

Currently, the Mombasa tea auction in Kenya is the largest made-tea market place in the region attracting the commodity from Uganda, Tanzania, Rwanda, Burundi, Madagascar, Zimbabwe and the Democratic Republic of Congo.

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