Star- Coffee and tea were a key source of income for most families in Central Kenya before the decline that we have witnessed since the late 1990s. Tea extends further to the Rift Valley and parts of Western Kenya and has benefited very many families over the years.
But as a nation, we are a far cry from the vibrancy and profitability witnessed in the past in the tea industry. Tea farming has become a pain for most farmers due to what is now seen as mismanagement by the Kenya Tea Development Agency.
What I would get growing up to pay fees is now barely enough. Most farmers constantly wonder if they should uproot their tea bushes and put their land to better use.
KTDA has allowed middle-men to hoard the produce and in the process made it difficult for farmers to make money out of their hard work. Some have even gone to the level of controlling farm inputs, making it even more expensive to make sustainable investments.
The management service fee that KTDA has been taking should be reexamined first. At 2.5 per cent of the value of tea sales, KTDA and its subsidiaries gobble between Sh1.6 billion and Sh2 billion every year as management fees.
For long, the cartels have been profiting through the same kind of underhand dealings that could only have been happening with the blessings of KTDA. In addition, we have learnt that Kenya loses at least 100 million kilogrammes of tea to hawking each year.
There is no reason why tea farmers should earn less than a quarter of what their green leaf fetches at the auction in Mombasa. It is not logical that tea is auctioned at Sh80 per kilo but farmers are paid Sh18 per kilo.
To properly examine the problem with KTDA, one must first appreciate that the board has clung to power for more than a decade despite mismanaging the industry. And due to this mismanagement, many farmers have since the early 2000s uprooted the crop, posing a threat to livelihoods.null
Luckily, we are entering a new age with the recently enacted Tea law and regulations. However, there is a feeling that the current board cannot lead these reforms and before it leaves office, there is need for a forensic audit.
The management service fee that KTDA has been taking should be reexamined first. At 2.5 per cent of the value of tea sales, KTDA and its subsidiaries gobble between Sh1.6 billion and Sh2 billion every year as management fees.
On December 23, President Uhuru Kenyatta signed the Tea Bill into law. The Bill introduced a raft of measures, among them revival of the Tea Board of Kenya, changes in the auction process and export, limiting the number of tea factory board members and a new levy.
One key change is that the law will now ensure auction organisers, buyers and brokers pay farmers up to 50 per cent from the proceeds of sales within 14 days. This will tame KTDA, which has been accused of holding onto farmers’ money.
The new law presents opportunities for the tea sub-sector to enhance marketing of the product to new export markets. The regulations will see better management of the sub-sector which will result in higher earnings for farmers.
Every move should be to protect farmers and, therefore, the government should crack down on the KTDA management that has mismanaged the sub-sector in the past.
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