More stocks of unsold teas are back in the warehouses over the levy

Agriculture and livestock development CS, Mutahi Kagwe. [File Courtesy]

Tea warehouses in Mombasa are reportedly holding 10,554,071 kilogrammes of made tea since the introduction of the tea levy of Sh 2.28 per kilo destined for export.

In the last five auctions, factories in the east of the rift between May 1 and June 2, accumulated 9,142,657 kgs, in the warehouses, and those in the west of the rift packed 1, 141,414 kgs.

Tea farmers at Ikumbi, Githambo, Kanyenya Ini, and Makomboki factories in Murang'a objected to the tea levy, calling on the Agriculture Cabinet Secretary, Mutahi Kagwe, to offer an honest direction to save the industry from imminent collapse.

In the data in our possession, in the five auction durations, buyers are reportedly interested in the teas from the west of the rift factories, owing to the low prices and the quality.

The dealers, the experts in the tea market, said the introduction of the levy shifted the buyers to the teas from Uganda, Tanzania, Rwanda, and Burundi traded at the auction but exempted from the levy.

“East of the rift in the duration sold 13,327,633 kgs compared to the offer of 22,470,290 kgs, as West of the rift, in return, managed 10,247,117 kgs against the offer of 11,658,537 kgs,” said EATTA Managing Director George Omuga when reached by the Standard.

Last year, in the same duration (sales 18 to Sale 21), east of the rift had sold 12,515,661 kgs against the offer of 15,977,000 kgs.

In the West, the factories had offered 17,561,432 kgs at the auction, where 11,533,268 kgs were sold.

Omuga said last year, there were old tea stocks from the previous years after the reserve price was imposed, leading to accumulated stocks that crushed the auction by October 2024.

“When the reserve price was removed allowed the re-offers of very old teas,“ he said

At the same time, Kiharu MP Ndindi Nyoro has called on parliamentarians from tea-growing areas to resist attempts to increase the punitive taxes levied on farmers.

Ndindi said that the parliament should focus on generating growth for farmers rather than exposing them to more suffering.

Spoke during a public participation ahead of the construction of Githambo-Matharite-Nduru ini-Kahatia road measuring 27km, estimated to cost Sh 2.5billion.

He said he will be the last person to accept the tea farmers' exposure to suffering, as parliament should be ready to stop increased levies on the farmers.

“We, the MPs, will ensure we remain supportive of the farmers, and free them from the chains of taxation,” said the Kiharu MP.

He echoed Kirinyaga Senator Kamau Murango's sentiments that the tea levy was an illegal entity, which was implemented before the regulation was passed in parliament.

“The Tea Amendment Bill 2023 was declared null and void by Speaker Moses Wetangula on May 26, through a communication, upon the establishment of faults caused by Gatundu South MP Gabriel Kagombe after he failed to declare interest in the agriculture committee,” said Murango.