A wave of disappointment and renewed frustration is sweeping across the country’s tea-growing regions following the release of the Kenya Tea Development Agency’s (KTDA) interim financial report for the year ending June 30, with the document showing that second payments to farmers have dropped sharply and exposed wide disparities in earnings between factories in the East and West of the Rift Valley. Tea farmers suffer reduced earnings as KTDA bonus payouts fall sharply, exposing deep regional disparities across tea-growing factories.
The report indicates that more than 680,000 smallholder farmers across 21 tea-growing constituencies will receive between Ksh 0.80 and Ksh 19.10 less per kilogram of green leaf compared with the previous year, deepening anxiety over the fairness of pricing structures and the sustainability of the current marketing model.
Factories based in the Mt Kenya region will pay bonuses ranging between Ksh 26 and Ksh 57 per kilogram, while those in the Rift Valley and South Nyanza counties will remit between Ksh 10 and Ksh 32 per kilogram, perpetuating a long-standing divide that has historically disadvantaged growers in the West.
The scale of the decline is illustrated by Kiru Tea Factory in Murang’a, which declared a payout of Ksh 32 per kilogram compared with Ksh 51.10 last year, a fall of Ksh 19.10 that has left farmers struggling to cover household and farm expenses.
Embu’s Rukuriri Tea Factory emerged as the highest payer nationally at Ksh 57.50 per kilogram, though this was still lower than the Ksh 61.50 recorded a year earlier. At the opposite end, Kiamokama and Rianyamwamu factories in Kisii will pay just Ksh 10 per kilogram, half of last year’s Ksh 20, while Nyamache and Itumbe farmers will receive Ksh 11, also down from Ksh 20.
The uneven earnings have renewed debate over the Mombasa Tea Auction, where most Kenyan tea is traded, and whether its pricing mechanisms work equitably for all regions.
The suspension of the reserve price mechanism, which previously set a minimum threshold for Kenyan tea at the auction, combined with rising electricity costs and other processing expenses, has reduced factory revenues and narrowed the pool of funds available for second payments.
There are growing calls for structural reforms aimed at expanding market access for teas from all production zones.
Proposals under discussion include establishing a second auction in the South Rift to complement Mombasa, which could attract more buyers, improve competition, and potentially reduce the wide gap between East and West of the Rift.
The decline in bonus payouts comes at a critical time for the tea sector, which remains one of Kenya’s largest foreign exchange earners but is grappling with fluctuating global demand and rising production costs.
For farmers who rely on the annual bonus to pay school fees, settle debts, and reinvest in their farms, the reduced earnings represent a strain on livelihoods and a warning sign for the long-term stability of smallholder tea farming.
With regional disparities widening, the industry now faces renewed pressure to review pricing mechanisms, address operational inefficiencies, and safeguard the incomes of hundreds of thousands of rural households who depend on the crop.