Tea Earnings Hit Ksh.140 Billion in 2018 as Volumes Balloon

Tea earnings increased to 140 billion shillings in 12 months to December 31, 2018, up from 129 billion shillings recorded in 2017.

The increase has is said to be as a result of increased volumes that defied low international prices in the market and improved weather conditions in tea growing areas during the first half of 2018.

Production reached a high of 474 million kilos in the review period, up from 415 million kilos exported in 2017.

The Tea Directorate, however, forecasts that the volumes will this year drop to 416 million kilos from a high of 474 million kilos realized last year.

The decline, says the directorate, will see the average auction price surge to 280 shillings per kilogram of tea up from 260 shillings per kilogram achieved in 2018.

“Kenya tea production is expected to come to about 416 million kilos this year, down from what was produced in 2018, which is largely attributed to dynamics in the weather conditions in tea growing zones,” said the Tea Directorate.

Local sales are expected to grow by five percent to 40 million kilograms, boosting the domestic earnings from the beverage to 18 billion shillings compared with 16 billion shillings earned last year.

Local consumption of tea during the year came in at 38 million kilograms, a marginal increase from the 36.6 million kilograms consumed in 2017.

Pakistan remained as the top destination for Kenyan tea taking up a total of 13.9 million kilograms of the product to top the export category ahead of Egypt and the United Kingdom at 5.2 and 4 million kilograms respectively.

The price of tea at the Mombasa auction has been on a decline since June 2017 when it stood at 230 shillings a kilo to hit a four-year low at the moment.

In the weekly trading held last week at the Mombasa auction, a kilogram of processed tea on average fetched 200 shillings down from 270 shillings on average in the corresponding period last year.