Uganda’s tea industry in crisis as farmers abandon plantations over plunging prices 

UGANDA – Uganda’s tea industry is grappling with a severe crisis as plummeting green tea leaf prices drive farmers to abandon their plantations in search of more sustainable alternatives.  

The decline in prices has left many farmers unable to meet basic living expenses, prompting a widespread shift to other crops such as maize and bananas. 

Tea is Uganda’s third most valuable agricultural export, following coffee and fish. Over the past eight years, the country has earned an average of US$76 million annually from tea, with a peak of US$93 million recorded in 2018. However, the current price decline threatens to reverse these gains. 

Farmers in tea-producing regions such as Kanungu, Kayonza, and Buhoma report that prices for green tea leaves have dropped from UGX 500 (US$0.14) to UGX 200 (US$ 0.055) per kilogram. This reduction has made it increasingly difficult for them to cover production costs.  

One farmer, Francis Byamukama of Kayonza, stated that he had uprooted seven acres of tea to plant food crops instead. He cited the inability to afford his children’s school fees as a key reason for the switch. 

The crisis has been attributed to several compounding factors, including weak global demand, high input costs, and deteriorating tea quality. Farmers and industry leaders have also criticized the government for a perceived lack of policy support and strategic investment. 

Onesimus Matsiko, chairperson of the Uganda Tea Outgrowers Association, pointed to inadequate government involvement as a root cause of the sector’s decline. He warned that without urgent action, the industry’s collapse could continue unchecked. 

Ugandan tea has been performing poorly on the international stage. At the Mombasa Tea Auction, it fetched an average of US$0.79 per kilogram—far below the US$2.22 and US$2.46 recorded for Kenyan and Rwandan teas, respectively.  

This price disparity has further discouraged Ugandan farmers, many of whom are turning to alternative income sources. 

The crisis has affected processing factories as well. Facilities like the Kayonza Growers Tea Factory are battling rising operational costs, exacerbated by reliance on costly generators due to unreliable electricity supply.  

According to General Manager Jonathan Musinguzi, the financial strain has forced factories to lower payments to farmers. 

In response, farmers have petitioned Parliament and the Cabinet, seeking intervention to stabilize the sector. Experts suggest that Uganda could benefit from exploring specialty teas and strengthening farmer cooperatives to boost quality and improve global market access. 

Sign up HERE to receive our email newsletters with the latest news and insights from Africa and around the world, and follow us on our WhatsApp channel for updates.