High-quality Kenyan tea attracts higher costs at public sale on excessive demand

High-quality Kenyan tea attracts higher costs at public sale on excessive demand

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Quality of tea bought by way of Mombasa Tea Auction between January and October 2024 led to extra aggressive bids and significantly greater costs with export volumes recording a 37.5 per cent improve.

October month-to-month tea report launched early this week by Tea Board of Kenya (TBK) indicated that farmers and factories producing top quality tea are set to take pleasure in higher costs because the public sale adopted high quality with “Good” to “Medium” classes.

TBK Chief govt Willy Mutai mentioned that through the month of October 2024, tea provided on the market by the smallholder tea factories managed by KTDA, whose high quality is comparatively greater, fetched a median value of $2.83 (Sh366) per Kg for the primary grades in comparison with $2.78 (Sh360) recorded throughout the identical interval in 2023.

“Depending on the quality band, the leaf grades generally attracted relatively higher prices than the dust and secondary grades, respectively,” he mentioned.

Mutai disclosed that public sale gross sales quantity for Kenya tea through the month of October stood at 32.58 million Kgs, which was decrease in comparison with 38.63 million kgs recorded through the corresponding month of 2023.

The complete export quantity for the month of October 2024 was decrease by 9.04 per cent to 4.33 Million Kgs from 47.96 million kgs recorded in the identical interval of final yr to 43.63 Million kgs.

“This was in spite of shipments to more export destinations at 61 compared to 56 for the same period of last year. Lower export volume was attributed to less exports to the traditional and emerging markets, with Pakistan recording less imports by 4.71 million kgs while exports to Egypt were lower by 2.63 Million kgs,” the CEO said.

Despite decrease quantity, Pakistan maintained its place because the main export vacation spot for Kenya tea having imported 13.10 million kgs, which accounted for 30 per cent of the overall export quantity.

Egypt adopted because the second most most well-liked largest export vacation spot having imported 6.22 million kgs and was adopted by UK (3.80 Million kgs), UAE (2.87 million Kgs), Russia (2.77 million kgs); India (2.37 million Kgs), Sudan (1.60 million kgs); Poland (1.23 million kgs); China (1.09 million kgs); and Saudi Arabia (0.69 million kgs).

The prime 10 export locations, majority of that are conventional markets for Kenya tea accounted for 82 per cent of Kenya tea export quantity. Apart from Pakistan, Egypt, and Saudi Arabia, all the opposite conventional markets recorded greater imports for Kenya tea.

Similarly, rising markets of Oman, Sri Lanka, Ukraine, Qatar, Germany and Eritrea recorded improved imports from Kenya. Despite gradual restoration, exports to Sudan have continued to be affected by inside battle, which has been occurring for the final one and a half years.

Mutai mentioned that although there was typically good demand for tea provided on the public sale, the costs continued to be impacted negatively by comparatively greater provide.

He mentioned that the demand for tea on the public sale continued to be affected by the results of world financial shock skilled in most international locations as a result of Russia-Ukraine disaster and market entry challenges owing to inside battle in Sudan in addition to cargo disruptions by way of the Red Sea.