The Mountain Journal
Tea farmers advised to brace themselves for less tea bonus following myriad challenges that befell the tea industry this year.
The lucrative sector in the six months has faced a series of misfortunes, including the Middle East crisis involving Iran, Israel and the US, and the tea levy.
KTDA Holding Chairman Enos Njeru said the Middle East crisis disrupted the movement of tea to the markets as the routes of the shipment took longer, thus the expenses passed to the factories.
In a talk show on Inooro TV this week, Njeru said the tea bonus, to be declared later in the year by the factory boards, will be lower, based on the production cost having increased to Sh 133 per kg, up by Sh 20 compared to last year.
“ There are many dynamics that will affect the reduced tea bonus, bearing in mind that we also increased the price of green leaf to Sh 30 per kg up from Sh per kg,” said Mr Njeru.
On the tea levy, he said the sale of premium tea remained affected, as buyers passed the cost to factories to protect their profit margins.
“As the KTDA factories, we found it prudent to accept lower prices to save most of our teas rejected by the buyers owing to the high prices, and the return to the warehouses has implications,” Njeru revealed.
He added that since the implementation of the tea levy of 0.8 percent ( Sh 2.28) per kg, the majority of the factories that sell premium teas failed to attain the mark of $3 dollars ( Sh 388.35) per kg.
“The levy was part of the regulation introduced in the tea sector, but its implementation was at the wrong time when the sector was facing myriad challenges,” said Njeru.
On the import of the much-awaited fertilizer, he said the ships will dock in Mombasa in August and September, with the consignment transported to the farmers in their buying centres.
“ We expected the fertilisers to have arrived in Kenya by July, but the Middle Crisis affected the movement of materials required in its manufacture,” he hinted.
