Tea farmers in a region of Kenya are being feeling the brunt of a recent slump in marketing the produce after factory boards announced they are maintaining Sh23 per kilogram as the flat montly payment rate for the green leaf.
The boards in a statement on Wednesday cited weak market performance for the decision.
“The financial position of the factories does not allow for an upward adjustment of the monthly green leaf payment at this time” the boards maintained in their joint statement.
Those directly affected are farmers in Kericho and Bomet counties.
The decision was made after a regional meeting at the Kapkatet Tea Factory attended by factory bosses and other stakeholders under the umbrella of the Kenya Tea Development Agency (KTDA).
According to the boards, the 2024/2025 financial year saw low tea absorption and depressed auction prices, significantly undermining factory revenues and cash flows.
Stakeholders also lamented the dropping global demand for tea accounting for price instability which left a deleterious effect on earnings across the value chain.
The Mombasa Tea Auction had reflected this dispairing situation.
In this dreary situation, payment to tea farmers may not be sustainable in the long haul the volume of the product to factories declined progressively.
Farmers are however encouraged to continue supplying factories where market conditions may normalise and improve revenue flows.
WN/as/APA