What you need to know:
- The announcement was made by Deputy President Rigathi Gachagua who revealed that KTDA factories earned Sh95.3 billion in 2023, up from Sh93.02 last year.
- Mr Gachagua noted that tea contributes about 2 per cent to Kenya’s Gross Domestic Product and earns about Sh120 billion through exports.
The final bonus payment to over 750,000 tea farmers is expected to be disbursed in next month.
This follows an initial disbursement by the Kenya Tea and Development Agency (KTDA) in January in which farmers received Sh5.5 billion.
The announcement was made by Deputy President Rigathi Gachagua who revealed that KTDA factories earned Sh95.3 billion in 2023, up from Sh93.02 last year. This followed an improvement in green leaf prices from Sh50.14 per kilo to Sh59.1. He said that the results were due to reforms in the tea sector aimed at enabling farmers to earn more.
“We are proud that within six months, we are restoring sanity and stabilising the tea sub-sector, putting more money in the farmer’s pocket. We are dignifying the farmer. The farmer can now pay school fees for his children; the farmer can now invest in his dream projects,” he said.
Mr Gachagua noted that tea contributes about 2 per cent to Kenya’s Gross Domestic Product and earns about Sh120 billion through exports.
“In 2021, the tea sub-sector earned the country Sh136 billion in foreign exchange. Last year, we earned Sh138 billion. This year, with the full implementation of the reforms, we expect export earnings to rise to about Sh150 billion,” said the DP.
In the latest disbursement, Gitugi Tea Factory in Nyeri County, Imenti Tea Factory in Meru County and Michiimikuru Tea Factory recorded the best performance in combined annual earnings.
“Gitugi Tea Factory recorded an impressive Sh78.3 per kilo, an increase of 26 per cent. This factory is also the country’s leading processor of orthodox tea, whose consumption is steadily increasing worldwide. At Imenti Tea Factory, farmers earned Sh73.1 per kilo, while those at Michiimikuru Tea Factory earned Sh68.6 per kilo,” said Mr Gachagua.
Momul Tea Factory in Kericho County was lauded for consistently producing quality tea.
It was also noted that poor performing factories such as Nyankoba in Nyamira County, Kapsara in Trans Nzoia County and Kiamokama in Kisii County have improved. Nyankoba was the most improved factory at 37 per cent, with farmers earning Sh55 per kilo from a low of Sh40.1.
Mr Gachagua took the opportunity to condemn tea cartels and promised to summon the Inspector-General of Police, Director of Criminal Investigations and Director of Public Prosecutions to find a way to arrest the criminals.
He also advised KTDA to evaluate its investments, identify those that are not making profit and consider liquidating them.
“The other reason why KTDA is not doing well is because it has invested in unprofitable ventures. Any profit from the tea sector should go to the farmer. We will support value addition. Instead of divestment, where you spend money on unnecessary things, let’s focus on value addition so that we can make our tea of a quality that will attract foreign investment,” said Mr Gachagua.
He also urged tea farmers to embrace other tea varieties such as purple tea as a strategy to reach wider, trendy and high value markets. He further encouraged farmers to register for the subsidised fertiliser programme to cut their production costs.