Thursday, Jan 29th 2015

Global tea forum not a cartel - board

Tuesday, January 29, 2013 - 00:00 -- BY SOLOMON KIRIMI

The International Tea Producers Forum formed recently will not act a cartel to control prices as widely perceived by analysts. Tea board of Kenya managing director Sicily Kariuki says the forum will only be used for exchange ideas on development of the sector.

Kariuki sought to dispel fears that the forum bringing together six of the world’s top producers was aimed at controlling supply to manipulate market prices.

The six, Kenya, India, Indonesia, Malawi, Rwanda and Sri Lanka, account for more than 80 percent of the world's tea output.

“It is nothing new, but only a revival of forum for closely cooperating as producers and a framework of consulting and coordinating whatever is good for the industry,” Said Kariuki

Kariuki was speaking while releasing the Kenya tea industry performance for last year, in which the production recorded a two percent drop compared to 2011.

Output dropped to 369.5 milion kilograms compared 377.9 attributed to effects of frost on 3000 hectares of tea farms in parts the country early last year.

Export earnings rose to Sh112.2 billion compared to Sh109.4 billion in 2011 attributed to improved prices. A kilograms of tea fetched an average $3.18 last year compared to $2.99 in 2011.

“Our earnings were also stabilized by exports to emerging markets Russia, Djibouti, Indonesia and Turkey which increased by between 18 and 135 percent, as well as shifting preferences from Orthodox to black tea,”

Kenya is the world’s largest exporter of black tea. Locally, tea consumption rose 13.6 per cent to 22.7 million kilograms compared to 20 million kgs in 2011, and earned the industry Sh14.9 billion.

Tea Board Of Kenya projects that the output for next year will go up by just one percent from 369 million kilograms last year to 373 million kilograms