Agriculture and Livestock Development Cabinet Secretary (CS) Dr. Andrew Karanja has promised sweeping reforms in the tea sector that supports the livelihood of more than 834,129 farmers in the country.
This is after it emerged that the sector has been grappling with the challenge of unsold tea that has been stored in Mombasa warehouses. The unsold stock, which was initially at 100 million kilogrammes, has now been reduced to 70 million kilogrammes, amid concerted efforts to clear it by the end of September.
CS Karanja said some of the successes in Kenya’s tea sector can be attributed to favorable weather conditions and government intervention through the fertilizer subsidy program. However, from where he sits, timely absorption of tea is being affected by the current economic recession facing some of the major and critical markets such as Pakistan, Egypt and Sudan.
Karanja noted that as a result of the fertilizer subsidy program, tea production for the half-year period of 2024 was 321.09 million kilogrammes up from 273.64 million kilogrammes recorded during the same period of the year in 2023.
“We are going to have one of the highest production in tea (this year). That is one of the issues that is creating a bit of a problem in terms of stock… it’s anticipated that by the end of this year the tea industry is going to bring more than Sh2 billion,” Dr Karanja said during a meeting with Tea stakeholders at the East African Tea Trade Association (EATTA) offices, in Mombasa.
He added that this year’s tea production will surpass last year’s by eight per cent, with preliminary analysis indicating that in the Financial Year (FY) 2023/2024, the average payments to the smallholder tea farmers will increase to about Sh 66 per Kg of Greenleaf from Sh59.02 in the FY 2022/2023 and Sh50.18 in the FY 2021/2022.
“We have realized that we have some old stocks which we need to clear and one of the bottlenecks, which is happening to make sure that it’s not cleared is the reserve price. We are suspending that reserve price for the old stock,” he said, adding that a committee will be constituted to look at the reserve pricing to make sure it doesn’t remain static and create problems.
Additionally, to address challenges of low quality, the ministry will come up with measures to have a minimum standard of quality.
The CS said the country has started producing “orthodox tea” for specialized markets like China.
“We are going to put up structures to make sure that the orthodox tea is sold through an auction. We may create another second auction to sell our orthodox tea,” said the CS.
Karanja said they have noted certain unethical trade practices and collusion in the trade, thus the government will put in place measures to stop this malpractice as it compromises earnings of the farmers.
“We have requested the Tea Board of Kenya to look into the matter and expose all those who may be colluding with some of the directors or the entire system, resulting into unfair prices. If anybody is caught we will revoke the license,” he warned.
He further added that the government is accelerating efforts in marketing tea to increase demand through new markets.
Speaking at the same event, Agriculture PS Dr. Paul Ronoh assured farmers that the government is committed to solving all challenges facing the tea sector, even as he put on notice unscrupulous business persons hindering the tea trade.
On his part, the Kirinyaga Senator James Murango, who also chairs the Senate committee on Agriculture, Livestock and Fisheries, said they want to find solutions to the biting challenges in the tea sector.
“For a farmer to reap maximum benefits, the entire process on how tea is grown and sold must be streamlined,” he stated.
The Senator called for a re-look at the tea payments made starting from the farms to the Mombasa Auction, and a possible reduction in warehouse charges, taxes and equipment used for tea production, so that for farmers can reap maximum benefits.
“I want to assure farmers that they will see an improvement. The government will streamline tea farming to make it an agribusiness venture and not just farming,” he said.
