Tea sector posts Sh180b in 2023 on stable prices

Tea industry posted Sh180.57 billion for the year ended December 31, 2023, an increase supported by high volumes, stable prices and favourable exchange rate.

Yesterday during an activity presided over by Deputy President Rigathi Gachagua, it was noted that the industry annual earnings increased by Sh42.48 billion from Sh138.09 billion registered in 2022 production year accounting a 31 per cent.

Speaking at the Tea Board of Kenya headquarters (Tea House) during the release of the 2023 tea industry performance results, the DP noted that in 2023, the industry recorded the highest export earnings ever of Sh180.57 billion.

This, stated is a significant increase from Sh138.09 billion in 2022 and Sh136.59 billion in 2021. “During the year, Sh16.4 billion was generated from the sale of tea in the domestic market thus resulting in a total marketed value of Sh196.97 billion,” Gachagua observed.

The industry also recorded good production with the crop for 2023, hitting a record high of 570 million kilos compared to 535 million kilos in 2022.

“In the 2023/24 financial year, it is envisaged that the income to smallholder tea farmers will surpass the performance of the last two years,” said Gachagua.

He stated that over and above the stated driving factors, the national government has since the second half of 2022 aggressively fast-tracked implementation of key reforms targeting at dealing with challenges facing small-scale tea farmers.

To maintain the stellar performance going forward, Gachagua said the government will continue to implement the necessary reforms to enhance its competitiveness and increase returns to growers in line with (Bottom-UP Economic Transformation Agenda (BeTA).

“In this regard, I direct the Cabinet Secretary for Agriculture to work with my office to complete implementation of other reforms, particularly those addressing the increasing cost of production, green leaf malpractices like tea hawking,” he added.

Value of tea exports

Intensive implementation of reforms initiated during the last regime, Gachagua said, is expected to increase in the value of tea exports from Sh180.57 billion in 2023 to over Sh272 billion by 2027 and earnings of smallholder tea farmers from the current average of Sh59.02 in the financial year 2022/23 per kg of greenleaf to Sh90 per kg by 2026/2027 financial year.

Agriculture Cabinet secretary Mithika Linturi said the industry is on the right path of growth, assuring that efforts, and especially on improving governance will continue to be fast tracked.

He noted that most of the smallholder tea factories have reviewed and signed their management agreements with Kenya Tea Development Agency Management Services (KTDA MS) to enhance effectiveness and efficiency in the management of the smallholder tea factories.

Meanwhile, Coffee farmers have welcomed the government’s decision to scale up reforms and development in the sub-sector through a knowledge-sharing programme with their colleagues from Colombia, one of the leading top producers of coffee globally.

The farmers, together with members of the visiting Colombia National Federation of Coffee Growers, on Wednesday toured the KALRO-Coffee Research Institute (CRI) Ruiru, Kiambu County, for a day-long joint learning session on best farming practices of the crop.

“The joint training will benefit local farmers in their work. We urge the government to sustain the reforms because, soon, production will increase and farmers will get money in their pockets fostering the rural economy,” said Francis Ngone, the chairperson of National Coffee Co-operative Federation of Kenya.

“In the one year the reforms have been ongoing, the sub-sector has changed positively.

We are supporting the government in that exercise to restore coffee as a source of livelihood for rural families,” he added.