Kenya: KTDA observes tea price decline for third consecutive year

Tea prices in Kenya have declined for the third consecutive year because of supply surplus across the globe, said Kenya Tea Development Agency (KTDA), according to a report by Xinhua Net.

Reportedly, the price decline has been noted due to more production of tea than what is demanded in the market.

Adding more on the price fall, Alfred Njagi the Managing Director of KTDA Management Services, said that the volume of green leaf produced in the first 6 months to 2020 December, by the smallholder tea farmers has dropped slightly by 0.7 % to 615 m kilograms compared to 2019 in the same period with a total of 619.5 m kilograms.

Njagi further added, "high volumes of tea produced in the east African region and elsewhere on the globe have contributed to the continued price decline in the global market".

However, the data issued by the Kenya National Bureau of Statistics (2020) showed that the smallholder farmers in Kenya, including those who deliver to KTDA managed firms have been reportedly increasing acres under tea that has contributed to an increase of offer on tea volumes in the market.

"The impact on tea prices of the commencement of the Tea Act 2020 that requires all black tea exports processed and manufactured in Kenya to be sold exclusively at the tea auction floor will soon be realized... We are waiting to see the full effects of the new law on the industry in the coming months," Njagi added.