Kenya’s tea earnings drop in May due to subdued export volume

Tea earnings in the month of May 2017 dropped by KES 1.3Bn from KES 9.7Bn in May 2016 to KES 8.4Bn.

The drop in tea earnings was on account of the subdued export tea volume which dipped 35.30 percent to 28.06 million kilogrammes from 43.36 million kilogrammes in a similar month last year due to drought impact.

However, the earnings dip of 13.68percent was cushioned by the 2.57 percent dollar appreciation in the comparable months (100.85 in May 2016 to 103.44 in May 2017).

Tea inflows in the first five months of the year came in at USD 1.26Bn to emerge the second top foreign exchange earner behind diaspora remittances which notched USD 1.75Bn.

For instance, The Kenya Tea Industry Performance Report for March tea production decreased significantly to 34.49 Million Kgs compared to 45.32 Million Kgs recorded during the corresponding month of 2016  largely attributed to dry and hot weather conditions experienced in all the tea growing areas.

“Cumulative production for the first three months of the year was significantly lower at 90.09 Million Kgs against 139.60 Million Kgs recorded during the corresponding period of 2016 owing to dry and hot weather conditions and delayed onset of the “Long-rains” season.”

“The total export volume for the month of March 2017 was 35.04 Million Kgs compared to 42.31 Million Kgs recorded same period of last year, representing a 17 percent decrease.”

In 2016, export earnings dropped to Sh120.6 billion, to reflect a drop of Sh4.5 billion compared to Sh125.2 billion recorded in 2015 crop season.