The Cabinet Secretary (CS) for Agriculture and Livestock Development Andrew Karanja has promised farmers sweeping reforms in the tea sector that support the livelihood of more than 834,129 farmers.
For months now the sector has been grappling with the challenge of unsold tea that has been stored in warehouses in Mombasa. The unsold stock which initially at 100 million kilogrammes has now been reduced to 70 million with efforts to clear it by the end of September.
Dr Karanja said that some of the issues in the tea sector can be attributed to successes like favourable weather, high production, and government intervention through the fertilizer subsidy program.
However, he added, 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.
As a result of the fertilizer subsidy program, tea production for the half-year period of 2024 was higher by 47.44 Million Kilogrammes (Kgs) (17 per cent) from 273.64 Million Kgs recorded during the same period of the year in 2023 to 321.09 Million Kgs.
This year, the CS said they expect to surpass the high production for last year by eight per cent from 570 Million Kgs to 615 Million Kgs.
“This current year we are going to have one of the highest production in tea. That is one of the issues that is creating a bit of a problem in terms of stock.
“It’s anticipated by the end of this year the tea industry is going to bring more than Sh2B. this is the first time we have crossed the Sh2B. it’s a positive move,” said Dr Karanja during a meeting with Tea stakeholders Friday at the East African Tea Trade Association (EATTA) offices, in Mombasa.
He further noted that preliminary analysis indicates 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 Kshs.59.02 in the FY 2022/2023 and Kshs.50.18 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,” declared Dr Karanja.
A committee will be constituted to look at the reserve pricing to make sure it doesn’t remain static and create problems.
To address challenges of low quality, the ministry will come up with measures to have a minimum standard of quality.
The CS revealed that the country has started to produce 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 Agriculture CS.
The CS said they have noted certain unethical trade practices and collusion in the trade and the government will put measures to ensure that is put to a stop as it compromises the earnings of the farmers.
“We have requested the Tea Board of Kenya to look at the matter and anybody involved in that may be colluding with some of the directors or the systems to undermine the market to make sure they are colluding on prices. If anybody is caught we will revoke the license,” stated Dr. Karanja.
He added that the government is accelerating efforts in marketing tea to increase demand through new markets.
On his part, Principal Secretary (PS) State Department for Agriculture Dr Paul Ronoh assured farmers that the government is committed to solving all challenges facing the tea sector, he put on notice unscrupulous business persons encumbering the tea trade.
Kirinyaga Senator and Chairman of the Senate Agriculture, Livestock and Fisheries Committee James Murango said they want to find solutions to tea challenges. “For a farmer to reap benefits the way tea is grown and sold must be streamlined,” he stated.
He called for a re-look at payments made for tea from the farms to Mombasa and for warehouse charges, taxes, and equipment used for tea production to be reduced for farmers to reap maximum benefits.
“I want to assure farmers that they will be an improvement. The government has taken the responsibility to streamline tea farming to be an agribusiness venture not just farming,”.
