This archive report was first published on 25 May 2020.
Kenya Tea Development Agency (KTDA) has warned tea farmers to expect lower bonuses this year due to overproduction and plummeting tea prices.
According to KTDA Chairman Peter Kanyago, tea farmers have produced 1.2 billion kilogrammes of green leaf, a 29% increase from the same period last year.
Speaking at Iriani Tea factory in Nyeri, Kanyago attributed the lower bonuses to the rule of demand and supply, stating that the prices of tea have gone down despite the increased production.
He further explained that the bonus will be affected by the plummeting of tea prices at the Mombasa auction, from Sh277.03 ($2.6) to Sh220.23 ($2.06) during the last auction.
KTDA has also expressed concerns over the newly released tea regulations, which the agency believes will lead to the downfall of the tea sector if implemented as they are.
The regulations, according to Kanyago, will see international tea buyers shun away from locally produced crop, and will not improve farmers' pay.
He also stated that the regulation that outlaws sale of tea directly to overseas buyers will not see farmers earn more, and that the proposal that requires buyers to submit a performance bond equivalent to 10% of the estimated tea value auction prior to the auction will push them to other tea producing countries.
