Kenya Tea Development Authority (KTDA) chairman David Ichoho said the new board had made significant strides in government reforms in the tea sector.
Ichoho said the price of Kenyan tea at the Mombasa Tea Auction rose significantly from $ 1.90 (Sh209) per kilogram on July 24 to $ 2.66 (Sh292) in September after the government introduced a minimum price.
The KTDA factories are currently in the process of announcing second payment installments for their 600,000 farmers across the country, which Ichoho says will likely be the same or slightly lower than last year.
As part of the reforms, regular high monthly payments were one of the main demands of farmers.
The chairman said the board has explored several new ways to cut costs, thereby increasing farm-level yields for farmers.
As a big plus for farmers who would have sought low-interest loans, he named a low interest rate of eight percent for loans from the group subsidiary – Greenland Fedha.
In addition, the Sh1 billion fertilizer subsidy the government offered to tea farmers means saving Sh600 per 50kg sack, and using standard gauge railways to move the cargo has saved farmers logistical costs.
“When the new board took office in July 2021 after a long excitement for change, a lot was expected of us. While there is more to be done, we have made transformational changes in months to achieve what tea farmers have wanted for years, ”said Ichoho.
He added that a forensic review of the corporate accounts will continue to catch and prosecute anyone who may have stolen the farmers’ income.
“We believe that managing the well-being of our farmers in a sustainable and conscious manner will bring economic freedom and a more affluent tea-growing community. This is just the beginning, “said Ichoho.
Stop cartel exploitation
Agriculture Cabinet Minister Peter Munya said separately that the government had done a lot to safeguard tea farmers’ interest in stopping cartel exploitation in the sector.
“The farmers have full control over the sector and the yields,” Munya said, adding that the government had helped import inexpensive fertilizer.
But former Murang’a director Francis Macharia said the prices at the auction don’t really reflect the situation.
He said farmers are currently producing less due to the pruning cycle and the prolonged cold season that has slowed regeneration.
“In a short time, when there will be more tea, the price will go down,” said Macharia, who represents the Murang’a growers on the board.