Tea farmers triple earnings with unique certification

By JULIUS OMONDI

The more than 6,000 Iriani tea farmers in Nyeri County have increased their earnings threefold through selling their tea to Fair Trade certified buyers.

 The model has earned them higher premiums, giving them a chance to explore other money generating ventures such as bee keeping, poultry, rabbit farming among others.

The concept is hinged on farmers under a particular group, cooperative or large-scale company being ‘Fair Trade’ certified.

Governance issues

For these entities to be Fair Trade certified, they need to fulfill a number of obligations based on proper governance.

They need rules governing inclusion of members, transparency in book keeping and commitment to environmental conservation.

Since the certification of Iriani tea factory, there has been a significant increase in market for the product as many buyers want to associate with certified products due to the high quality the organization must maintain.

“Initially, before being certified, we could not trade with any certified buyers because the buyers only put their faith in Fair Trade certified goods,” explains Hutchison Wanjohi, the Iriani Tea Factory chairman.

The initiative has enabled the company clinch a lucrative deal with Marks & Spencer, a UK chain of supermarkets who are Fair Trade certified, to supply their tea at a better price compared to what other buyers at the Mombasa tea auction are getting.

The model has also spurred the rate of production as more farmers are now being lured into the lucrative business.

“The Fair Trade model promise of high returns has spurred multiplier effect with more farmers embracing the idea to reap the benefits their counter parts are already pocketing,” notes Wanjohi.

“As a result, the number of tea farmers supplying us has risen from 3,000 to 6,000 within five years.”  

The partnership has availed the much needed funds which have enabled the group to champion value addition and this explains why they are the first tea factory in the country out of the 65 KTDA factories to package tea bags from the source.

 “The premiums model kind of trade is lucrative as we get an extra 50 cents per kilo of tea bought by Fair Trade certified buyers,” explained George Mwangi the Unit Manager at Iriani Tea Factory.

The certification involves yearly auditing by Fair Trade personnel to ensure  that the quality of the produce meets international standards.

Huge gains

The personnel also ensure that proper farm production methods are adhered to. For instance, they offer expertise on the types of seeds to be grown and type of pesticides and fertilisers to be used.

Iriani Tea Factory and the tea farmers supplying it were certified five years ago. Since then, the gains have been numerous, apart from the premiums that are guaranteed from the sale of the product to certified buyers. He also added that the company’s production has also realised a more than 50 per cent increase in output over the same period with leaf out putting also growing from 8 million to 12 million kilos yearly.

The certification process may take six months or longer depending on the level of organisational management, as those with existing management structures will conform to the standards easily.

The process also requires expenditure on the various permits for international standards certification.

 Others expenses include high quality inputs such as  seeds and pesticides among others.

“We spent about Sh600,000 to be fully Fair Trade certified producers,” says Wanjohi.  “The process may seem costly but the returns have been juicier. Since our certification, we have managed to receive over Sh7 million in premiums,” he added.

In 2012, farmers and workers globally, in Africa and around the world earned $ 80 million (Sh7 billion), $ 17 million (Sh1.5 billion) and $ 6 million (Sh522 million) respectively in Fair Trade premiums.