The Mountain Journal
The tea levy has negatively affected the industry with buyers abandoning teas from the east of Rift.
The buyers seek the Tea Levy should be pegged on volumes of the produce, instead on the alue.
The buyers have turned to the west of the rift and the neighbouring countries fearing cost imposed by the levy of Sh2.28 per kg of made tea.
Experts in the tea industry warn of the implications of the tea levy, while farmers fear anticipated reduced tea bonus..
In the weekly auction, the factories in the East of the Rift sold 35,440 packages achieving 55 percent, while those in the West of the Rift auctioned 32,780 packages( 88 percent).
“ The unsold tea category in the East of the Rift registered 28,940 packages at the rate 45 percent, while the west factories had 4,420 packages at 12 percent.” read the report.
Njunu tea factory Vice Chairman Peterson Gathua said it’s a reality that the stocks from the east are piling up in the warehouses, after buyers turn elsewhere.
“It is the first time the tea industry is witnessing this kind of challenge disrupting the market in a big way with buyers heading to other countries,” said Maina.
EATTA Managing Director George Omuga said in the weekly auction, the buyers bought 8.9 million kgs, out of the offer of 9.8 million kgs sourced from the five East African countries.
“At the auction Kenya offered 8,179,530kgs, sold 7.1 million kgs, Burundi offered 14,434kgs sold 13,243 kgs, Rwanda offered 797,230kgs sold 525,050kgs, Uganda sold 871,640kgs sold 819,832kgs, and Tanzania offered 5,120 kgs sold 5,116 kgs,” Mr Omuga said in a report.
The Tea Board of Kenya (TBK) stated that tea from the small holder factories was absorbed at the rate 70.69 percent.
Peter Kamore, a tea value chain expert, said at the auction there is need for the observation to ensure the tea sector is not hurt through the tea and the clearance.
Kamore pleaded with the TBK to suspend the tea levy following complications that will force the buyers to exit Kenya’s tea.
“ It is disheartening that the quality tea sourced from the east remains unsold as the buyers avoid paying more due to the imposed levy. Since May 1, buyers who had the passion for tea from the east have shifted to the west due to low charges,” said Kamore.
A trader Francis Mwai said it will be suicidal for the tea sector should the buyers shun interest on Kenya’s tea due to high cost following the tea levy..
“ Already, the writing is on the wall of major buyers relocating to other tea producing countries and buying Kenyan tea for blending purposes to avoid the tea levy,” said Mwa from Kirinyaga countyi.
KTDA Holding Chairman Enos Njeru said despite the challenges, the small-scale holder factories have continued producing quality tea for the market.
Mr Njeru appealed to the Tea Board of Kenya (TBK) to suspend the levy and provide a seamless framework that will remove the hitches along the value chain.
“The farmers are duty bound to produce the best for the market,” said Njeru.
