Tea farmers selling their produce to KTDA-managed factories recorded improved earnings in the July to mid-October period as volumes sold increased.
Average prices for teas from KTDA-managed factories increased to USD2.65(Sh320.65) in the period compared to USD2.55(Sh308.55) for a similar period last year.
Auction data shows that the factories have also sold more volumes this year with the amount of shipped teas being 41 per cent higher than last year.
The positive market data comes amidst a 13 per cent drop in farm production as sustained low precipitation affects farmers’ output.
Greenleaf deliveries by farmers to 71 KTDA-managed factories dropped to 197 million kilos in the July-September period compared to 225.8 million kilos last year.
“Prices at the auction have been fairly steady with a positive outlook expected for the coming weeks despite the market challenges faced with the Russia-Ukraine war and the flooding disaster that recently hit Pakistan,” KTDA Group CEO Wilson Muthaura said.
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Prices for KTDA-managed factories continue to outperform the aggregate Mombasa auction based on excellent quality and reforms instituted by the Agency including the introduction of a USD2.43(Sh294.03) reserve price for each kilo of made tea.
Factories are expected to curb their production costs and consistently produce high quality tea that fetches good prices in the market.
Muthaura added that the Agency has procured 84,550 metric tonnes of the NPK 26:5:5 chemically compounded fertilizer for distribution to farmers ahead of the short rains to boost farm output.
KTDA also continues to intensify its efforts in curbing costs by improving operational efficiencies through a number of initiatives.
These include investment in small hydropower stations for cheaper power supply, diversification to orthodox teas to reduce reliance on Black CTC teas, and training of farmers on income diversification and management.
A total of 11 factories are now producing orthodox teas. These are: Itumbe, Kimunye, Michimikuru, Kangaita, Imenti, Kiru, Thumaita, Gitugi, Kagwe, Matunwa and Chinga.
There are plans to increase the number of factories producing orthodox teas to meet the market demand for the product.
SOURCE: Capital business
