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Small scale farmers will continue to be paid their monthly payments despite the continued rejection of their commodity by buyers at the Mombasa tea auction, Kenya Tea Development Agency (KTDA) Holdings board has said.

KTDA holdings chair David Ichoho confirmed on phone the resources from its reserves will be used to pay farmers for the tea that has not been bought at the auction for two weeks.

East African Tea Trade Association (EATTA) auction rejected 55.47 per cent of tea offered for sale due to the reserve prices placed on all KTDA teas last week.

Hurting tea farmers

“As a board we have put in place both short term and long term strategies to ensure farmers are not hurt financially,” Ichoho said.

Last week buyers at Mombasa auction rejected smallholder teas worth Sh1 billion, after Agriculture cabinet secretary Peter Munya directed setting of a minimum price for all KTDA produce.

Tea brokers’ data indicated that 53 per cent of tea offered by KTDA was withdrawn from the Auction floor as buyers went off for those that traded at less than Sh181, the minimum price Munya set for smallholders’ commodity.

Agriculture Cabinet Secretary Peter Munya issued the decree arguing the reserve minimum average tea price should be based on cost of production, grade of the tea and a reasonable return to the tea grower.

“I don’t want to believe that the players, particularly brokers and buyers have taken the vital steps to align their business transactions and requirements accordingly,” said Agriculture Cabinet Secretary Peter Munya.