Tea factories in Meru, Murang’a, and Kiambu have declared interim dividend payments at a flat rate of Sh5 per kilo for produce delivered between July and December last year.
The payments to be effected at the end of April are popularly known as mini-bonus and are usually regarded as second term fees provision for the farming community.
According to the Meru regional director for the Kenya Tea Development Agency Limited (KTDA) Paul Ringera, seven factories in Meru County and one in neighbouring Tharaka Nithi have settled on the Sh5 rate during meetings of directors concluded this week.
“All factories are now preparing to pay the farmers the rates at the end of April and hopefully lessen the strain of the school fees burden in the new term,” Mr Ringera said in Meru town yesterday.
Weru Factory in Tharaka Nithi was the last to declare the rate in the region.
Kinoro, Imenti, Kionyo, Githongo, Igembe, Kiegoi, and Michi Mikuru factories in Meru County have declared the rates.
Ringera said although tea production had suffered the vagaries of dry weather since last November, production in the area remained at reasonable levels while prices at the tea auction have remained steady throughout the year. The tea production year runs from July to June the following year.
“By all intents and purposes, we are looking forward to another successful year for the smallholder tea farmer,” said Ringera.
In Murang’a and Kiambu, tea farmers are expecting mini-bonus payment in a month after KTDA officials complete tabulations.
Farmers in Murang’a and Kiambu are aware of the payment pegged at Sh5 per kilogramme delivered in the six months to December.
On Monday, directors from factories based in Kiambu and parts of Murang’a South regions agreed to pay the farmers at the rate once it is approved by KTDA.
Peter Kirigwi, from Ikumbi Tea Factory, said the boards had received communication of the payments expected by April 24, 2018.
“Farmers are aware of the process of deliberating on the payment which helps in sending children back to school for the second term,” said Mr Kirigwi.
Factory directors in parts of Murang’a North and Nyeri were scheduled to meet today to deliberate on the payment.
A director who declined to be named said the payment was based on what the farmers had delivered during the period under review.
“The amount will be reduced from the allocation that will be paid as the annual bonus at the end of the financial year," said the director.
In past years, Sh5 has been the proposed standard rate paid to farmers by the agency, but the figure fluctuated in some factories that performed badly in the half-year production.
Some factories in the west of the Rift Valley tea-growing region have in the past declined to pay any interim bonus payments because of poor performance.