EA Tea Trade Association projects drop in earnings

Written By: Benson Rioba
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Tea farmers should brace for lower prices next year if the economic turmoil continues in Sudan, Pakistan and Iran, which are key markets for Kenyan produce.

To help the situation, East African Tea Trade Association Managing Director Edward Mudibo is proposing that the government removes taxes and levies on tea to cushion farmers from low prices.

A section of rift valley MPs are calling for reorganisation or dissolution of the Kenya Tea Development Agency for what they term as underhand deals in the tea trade that has seen earnings drastically reduce.

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However, players in the tea trade say tea prices are dictated by market forces at the Mombasa tea auction which is transparent with minimal room for price manipulations.

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The East African Tea Trade Association predicts much lower tea prices next year due to economic challenges that key tea markets are facing.

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Iran is under US sanctions that have restricted trade with other countries.

This coupled with currency devaluations in Pakistan and Sudan as well as Brexit uncertainty is projected to hurt tea prices.

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Those in the tea value chain are calling on the government to consider removing taxes and levies on tea to reduce the cost of production and cushion farmers from low prices.

Even though factories have in recent years been encouraged to embrace production of orthodox tea, less than ten KTDA affiliated producers are processing the high value tea.

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