KENYA – Directors from the Kenya Tea Development Agency (KTDA) managed tea factories in the West Kenya region have united to address the pressing issues affecting tea production, notably the burgeoning stockpile of unsold tea in Mombasa.
The West Kenya bloc brings together directors from KTDA factories in Nakuru, Nyamira, Bomet, Uasin Gishu, Nandi, Western, and Trans Nzoia counties.
This coalition of directors has orchestrated a caucus, endeavouring to convene representatives from 40 tea processing facilities, encompassing 19 major factories and their respective affiliates.
David Rono, the chairman of the caucus, articulated their intent, stating, “We have collectively decided to establish an association that will empower us to confront challenges unique to the West Rift bloc. Our paramount concerns include the absorption of our tea in external markets, the exploration of novel market opportunities, and addressing the escalating levies in the sector.”
The primary objective of this collaborative effort is to brainstorm innovative ideas that can elevate the quality of tea production in the region while concurrently enhancing the income of farmers.
During the recent bonus payouts, farmers in the West bloc received comparatively lower returns than their counterparts in the East Rift bloc.
The tea produced in the West Rift is experiencing a sluggish absorption rate, resulting in substantial stocks accumulating in warehouses in Mombasa.
Rono expounded, “Our objective is to identify untapped markets to augment sales and revenue for smallholder farmers. The geopolitical conflicts in Sudan and the Ukraine-Russia war have impeded the absorption of tea, particularly Grade BB1, as these regions are major consumers of tea sourced from the West Rift.”
This collaborative initiative unfolds against the backdrop of a potential decline in Kenyan tea prices. According to a report by the World Bank, tea prices are anticipated to further decline in the upcoming year due to robust supply from major producers and weak demand from key importers.
The imposition of government levies on tea has exacerbated production costs for the commodity, leading to diminished revenue for farmers and other stakeholders in the sector.
Consequently, the Tea Board of Kenya has undertaken an audit of the tea value chain to address concerns regarding high production costs and their adverse impact on farmer incomes.
Simultaneously, there is a concerted push towards transitioning to speciality tea, fetching higher prices in the export market due to increased demand.
KTDA has already initiated the process of installing new speciality tea processing machines in 32 factories, with an estimated cost of KES 10 billion (US$65.9 million).
