Tea industry players work to raise local consumption

tea

Tea consumption in Kenya has decreased 

Photo credit: File | nation Media Group

Despite Kenya being the largest producer and exporter of tea in Africa, consumption of the produce locally is low.

The Tea Board of Kenya (TBK) and players in the industry are now conducting an awareness drive to increase tea drinking among Kenyans.

TBK chief executive Peris Mudida said 40.34 million kilograms of tea was sold locally in 2020 and 38.42 million in 2021.

“Consumption of tea is still very low in Kenya as it stands at around 8 percent of the total production annually. In the past few years, the consumption was at 4 percent,” Ms Mudida said.

“We are engaging with players in the market to sensitise Kenyans and farmers to increase consumption of tea as there is a huge market potential for the product locally.”

Most tea companies, especially multinationals and other privately owned firms, produce tea mostly for the export market.

In 2021, the tea sector cumulatively produced 537.83 million kilograms, compared with 569.53 million in 2020, reflecting a decline in production of 31.70 million.

Kenya exported 558.92 million kilograms of tea in 2021 and 518.92 million in 2020.

As a result of the rise in export volumes, the earnings rose to Sh136 billion from Sh120 billion the previous year, according to statistics provided by TBK that also show that Kenya earned Sh117 billion from tea in 2019.

The TBK projects that Kenya will earn Sh150 billion from tea exports as the global market recovers from the effects of Covid-19.

The tea sector provides livelihoods to over 650,000 farmers, with 6.5 million getting direct and indirect employment opportunities.

Ms Mudida said the board was formulating a marketing strategy for Kenyan tea so as to raise exports and enable farmers to earn more profits from their investment.

Kenya is seeking to secure a tea export trade deal with Iran, which has a huge market potential for the produce.

Ms Mudida said the board was working on how to secure at least five percent of the Iranian tea market, even though the country is under a United States trade embargo.

Ketepa flavoured tea

Kenya Tea Packers limited Managing Director Albert Otochi showcasing the firm's new orthodox and purple teas during in Kericho on June 3, 2022 . 

Photo credit: Pool

The embargo, however, does not include exports of medicine and food items to Iran, leaving a window for Kenya to pitch for the huge tea market.

“The biggest challenge with the trade deal we are pushing is receiving the payments for the exports, due to the trade embargo Iran faces. It is a matter that we are working on with the Iranian embassy in Kenya and our own in Tehran” said Ms Mudida.

Ms Mudida said a technical team from the board, along with processors, exporters and members of the business community, visited Tehran on a fact-finding mission on November 21-25 last year.

Ms Mudida noted that market intelligence showed that there is a huge preference for Kenyan-produced tea in Iran, and that the focus for processors should be on orthodox teas.

But payments from Tehran must come through a third country or party as Iran currently does not deal with the US dollar or the euro, the internationally accepted trading currencies.

Last year, Iran imported 53 million metric tonnes of tea from several countries, as its local demand far outstrips production.

Iran has 84 million people and its tea-drinking community depends on imports to satisfy the demand, as local production is low.

Kenyan-made tea has recently penetrated new markets, including the United Arab Emirates (UAE), Russia and other Commonwealth of Independent States (CIS) countries.

The CIS countries are Azerbaijan, Moldova, Ukraine, Armenia, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Russia.

Traditionally, Kenyan tea is sold in the United Kingdom, Pakistan, Sudan, Egypt, Japan, Qatar, Poland, Switzerland, Kazakhstan and Yemen.

The new TBK market pitch comes against the backdrop of cooperative societies and private factories exporting 84 metric tonnes of tea last year to Iran in a deal brokered by the Bomet County government.

The deal caused a stir, with Agriculture Cabinet Secretary Peter Munya declaring it fake and Governor Hillary Barchok insisting it was legitimate. 

Mr Barchok proceeded to export tea to Iran, even as the government sought through the 2021 Tea Act to bar such direct exports of the produce.

Iran’s ambassador to Kenya, Dr Jaffar Barmaki, and Kenya’s ambassador to Iran, Dr Joshua Gathimu, were at hand to receive Prof Barchok and farmers when the consignment was received in Tehran on October 2, having been flagged off in Bomet on July 25.

“As a devolved government unit, it is important that we find new markets for our produce and enable farmers to make maximum profits from the agricultural sector,” Prof Barchok said. 

“We should expand our market horizon and avoid being stuck in the traditional ones.”

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