The Mountain Journal
Effects of the tea levy have continued to take toll on Kenya tea after the buyers diverted to the west, owing to the implementation of the Sh 2.28 per kg levy at the auction.
Reports indicate that the percentage of tea bought from the factories in the east of the rift since May 1, have decreased over the implementation of the tea levy, an additional cost to the buyers.
As the debate on the tea levy takes centre stage, nine tea factories have lodged a suit in a Nairobi Court seeking for the revocation of the 0.8 percent tea levy, arguing it was punitive and implemented without the knowledge of the farmers.
In the market, KTDA factories in the east remained affected as in the weekly auction they sold tea compared to the previous months before the tea levy was imposed.
In the analysis, markets in the west have been favoured by the levy as since May 1, buyers shifted their loyalty pegged on price.
Nine factories in the west led by Nyamache and Giachore this week sold all the 5,600 packages of teas they had offered at the auction.
Factories in the East led by Rukuriri and Kimunye factories that dominated the auction through posting impressive sales in the week sold 40 packages and 120 packages respectively.
The reduced sale at Rukuriri led to a major loss that earned less than Sh 2 million, compared to their past earnings of more than Sh 70 million.
Momul factory led the factories in the west after it achieved a payment of Sh 22.4 million from the sale of 71,472 kgs.
In an analysis, Mt Kenya based factories last week lost after they sold 2,655,032 kgs against the offer of 4,494,941kgs.
In the west region, the factories presented 2,555,446 kgs, where the buyers took home 2,285,942kgs.
The tea factories directors from Mt Kenya region plan for a regional conference to deliberate on the performance of the tea industry, after the introduction of the tea levy on May 1 by the Ministry of Agriculture.
Tea value chain experts Peter Kamore and Mary Wangari called on the government to evaluate the performance of the tea levy since it was implemented.
They said it was absurd that the buyers are using Kenya’s tea to blend the produce from other countries.
“ There have been complaints from the farmers that the government should look at making the tea levy effective,” said Kamore.
