Tea Prices At Mombasa Auction Fall Marginally After 10 Weeks

By Jane Muia / Published November 14, 2022 | 11:31 am

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“There was good general demand at irregular levels following quality with an aspect of price adjustment for some categories for the 205,620 packages (13.8 million kilos) on offer and 138, 560 packages (9.2 million kilos) were sold,” said Eatta.

Tea prices at the weekly Mombasa auction fell marginally in this week’s sale marking the first time in the last 10 weeks that the price of the beverage has declined even though it managed to stay above the government-set minimum price.

Data from the East African Tea Trade Association (Eatta) shows a kilogram of the beverage fetched $2.44 (295 shillings) down from the $2.47 (298 shillings) that it achieved in the previous sale. The volumes of tea offered at the auction this week declined by 19 percent to 103,572 kilograms.

Tea prices at the auction have for the last two months recorded impressive performance with farmers hopeful for better earnings in the current financial year. In the seven months to July, the sector’s earnings grew to 80 billion shillings when compared with the 71 billion shillings recorded in the corresponding period last year.

This was helped by the government-backed minimum price of $2.43 (291 shillings) per kilogram which protected farmers’ revenue as well as good demand from buyers and a high exchange rate against the shilling.

Kenya Tea Development Agency (KTDA) accounts for at least 85 percent of the total tea that is sold through the Mombasa auction. The Agency projects an increase in earnings in the remainder of the year, as it continues with efforts to improve operational efficiencies.

These include investment in small hydropower stations for cheaper power supply, diversification to orthodox teas to reduce reliance on Black crush, tear, curl (CTC) teas, and training of farmers on income diversification and management.

Last year, tea accounted for about 19.6 percent of the total domestic exports valued at 130.9 billion shillings.