KTDA rules out tea price tricks

Kenya: The Kenya Tea Development Agency (KTDA) has dismissed reports that it is colluding with tea brokers and warehouses to manipulate tea prices at the Mombasa tea auction.

"These reports are aimed at destroying an already thriving industry," said KTDA's chairman Peter Kanyago, while speaking to the media at Chinga Tea Factory in Nyeri County.

Kanyango was referring to the Tea Industry Status report of May 2014, allegedly prepared by industry regulator, Tea Board of Kenya, that accused the agency of manipulating prices of high grade tea (PF1) which is mainly produced by small-scale farmers.

DENIED CLAIMS

"KTDA is yet to receive the said report but the Tea Board has already denied having issued it or of being part of the scheme to discredit the agency," Kanyago said.

The report said that PF1 grade tea is being consistently sold at low prices or at the same price with other inferior grades at the weekly auction. It further faulted the agency's direct sales system, to big marketers outside the auction venue, saying this is creating huge price differences, while creating the impression that there is excess tea in the market.

"Brokers strive to get the highest tea prices because their payment is commission-based. How then can they sell the tea at throwaway prices? There is simply no way to interfere with the prices," he said.

"In fact, tea farmers can expect better returns this year after tea prices started picking up at the Mombasa tea auction," he said.

He said these improved prices are as a result of reduced tea supply occasioned by the current cold season and the fact that most farmers have pruned their tea bushes.

 

NO POLITICS

Kanyago said the tea industry in Kenya, which is the main livelihood of some 560,000 small-scale tea growers and their families, should be protected from the kind of politicking that has over the years made the coffee and pyrethrum sectors unstable and unable to pay farmers on time.

"Tea farmers have never been known to go up in arms due to delayed payments and this is because of the existing sound management of the tea sector," he said.

He called on politicians to first familiarise themselves with the country's tea business before making sweeping statements that may end up denting the multi-billion sector.

Kanyago also dismissed calls by Kenya Union of Small Scale Tea Owners (KUSSTO) for disbandment of KTDA, saying they are malicious.