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Over 600,000 small-scale tea farmers affiliated to Kenya Tea Development Agency (KTDA) are set to receive second and final payment next month.

Chief executive officer Wilson Muthaura said the smallholder farmers will receive the payment popularly known as tea bonus in the second week of October.

“Preparations for the disbursement to the farmers will kick off soon. We expect farmers will earn impressive proceeds despite challenges encountered in the last one year and thus be able to manage their financial obligations,” he told Business Hub on telephone yesterday.

Muthaura said payment of proceeds conform to the provisions of the Tea Act 2020, which states that bonus payment should be paid three months after the end of every financial year.

Directors from the 71 KTDA-managed factories will initiate meetings early next week to review and approve annual accounts for the 2022/23 financial year. “The meetings to determine the second payment will run from September 11 to 22 and will be followed by a formal declaration of the second payment rates confirmed,” said KTDA Management Services MD, Julius Onguso.

The meetings come as preliminary data shows a marginal drop in green leaf production and sale prices at the tea auction in Mombasa.

For example, tea prices at the auction recorded a slight dip of 3 per cent with the average price for all KTDA-managed factories standing at $2.69 (Sh392.74) for year 2022-23 compared to $2.76 (Sh402.96) a year earlier.

Though the recorded prices this year are still above the reserve price of $2.43 (Sh354.78) set mid-2021 following a sharp decline of the same at the auctions past period.

The agency stated that green leaf delivered to KTDA-managed factories in the year ending June 2023 dropped 8.5 per cent to 1.146 billion kilos following severe drought that ravaged the country. In the 2021/22 production period tea farmers delivered 1.253 billion kilos.