SMILING TO THE BANK

Small scale tea growers expecting huge bonus, Munya

The main bonus will be paid in full by July 8.

In Summary

•“This year’s bonus is projected to be the highest to be paid to tea farmers across the tea growing counties since 2016,” according to Agriculture Cabinet Secretary Peter Munya.

•The CS further noted that in April, the 42 KTDA-managed tea factories paid a mini bonus for green leaves delivered between July 2021 to December 2021 totalling approximately  Sh3 billion.

A worker offloads green tea leaf at Matunwa tea factory in Nyaira which was opened by Agriculture CS Peter Munya
A worker offloads green tea leaf at Matunwa tea factory in Nyaira which was opened by Agriculture CS Peter Munya
Image: ANGWENYI GICHANA

Small-scale tea growers affiliated with the Kenya Tea Development Agency are expecting the highest tea bonus, agriculture Cabinet Secretary Peter Munya has said.

“This year’s bonus is projected to be the highest to be paid to tea farmers across the tea growing counties since 2016,” he said.

The main bonus will be paid in full by July 8 in line with the tea reforms introduced in the Tea Act, 2020.

The reforms made provisions for the balance due to the tea grower to be fully remitted within three months of the end of the financial year.

Previously farmers received their bonus in October.

Munya says that monthly payments to farmers are also being made by the 1st week of every month as opposed to the 3rd week.

“In July 2021, a mini-bonus for the last financial year amounting to Sh1.3 billion paid to the smallholder tea growers,” he added.

The setting of the reserve price has enabled KTDA to enhance the initial green leaf monthly payments to the smallholder tea grower from Sh17 to between Sh20 and Sh21 per kilogram.

Agriculture CS Peter Munya opens Matunwa tea factory in Nyamira
Agriculture CS Peter Munya opens Matunwa tea factory in Nyamira
Image: ANGWENYI GICHANA

Munya also noted that the price stabilization framework for the tea industry will cushion tea growers from price fluctuations that were making tea farming unsustainable.

Implementation of the Task Force on the Design, Development, and Implementation of the Tea Industry Price Stabilization Framework will be done during the financial year 2022-2023.

The report was launched in March and recommends the establishment of a Tea Fund to be used to cushion tea farmers against adverse price shocks, input subsidy to smallholder tea farmers, support the construction of warehousing facilities at the factory level, promote value addition either at the factory level or through the common user facility and invest any surplus funds for its sustainability.

In 2022-23, the government has made a budgetary provision for the supply of subsidized fertilizer to tea farmers in order to lower the cost of production, noted the CS.

To further reduce the cost of production, the ministry through the Tea Board of Kenya has finalized guidelines to guide the use of mechanical tea harvesting in order to save on Labour costs.

“Piloting of Mechanical Tea Harvesting within the smallholder tea sub-sector is currently ongoing and will be done alongside training of the farmers who will then train others. Once rolled out fully, it will create employment for many of the youthful generations in the tea growing areas.”

Green tea leaf at matunwa Tea factory in Nyamira county
Green tea leaf at matunwa Tea factory in Nyamira county
Image: ANGWENYI GICHANA

According to the CS KTDA is currently engaging tea brokers in order to administratively reduce brokerage and management agency fees which are projected to save tea farmers over Sh1 billion annually and will result in more earnings for tea growers.

KTDA is also set to restructure its operations to reduce costs and wastage and pass that cost saving to the farmer in form of reduced Management Agency fees.

At the moment, the funds will be set aside in an Escrow Account and later paid to the farmers.