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January 21, 2018

Tea prices grow slightly at Mombasa auction

A worker picks tea at a plantation in Githunguri near Kenya's capital Nairobi, January 6, 2012. REUTERS/Thomas Mukoya/File Photo
A worker picks tea at a plantation in Githunguri near Kenya's capital Nairobi, January 6, 2012. REUTERS/Thomas Mukoya/File Photo

Tea prices recorded a marginal rise by seven shillings per kilogramme from $2.71 (Sh271) per Kilo to $2.78 (Sh278) at the Mombasa auction.

Data from the East Africa Tea Trade Auction, indicates that out of the 165,476 packages (10,600,000 kg) available for sale during this week’s auction, only 147,789 packages (9,525,703 kg) was sold. This week’s total volume traded was 558,268 packages less than last week’s auction.

EATTA managing director Edward Mudibo attributed the increase in prices to demand for tea from Egypt, Yemen, Afghanistan and Middle-East.

“Egyptian Packers lent more interest and were strong with more inquiries from Yemen, other Middle Eastern countries, Afghanistan and Bazaar,” he said.

Mudibo said Pakistan Packers lent useful support while Russia, Kazakhstan, other Commonwealth of Independent States and the UK maintained interest with Sudan active, but selective.

“Iran was subdued. Somalia maintained good support at the lower end of the market,” said Mudibo.

In the last week of December 2017, tea prices shot from a seven-month low recorded at $2.68 (Sh268) to settle at $2.79 (Sh279).

The volume of tea offered was more by 800,000 kilos compared to the previous auction in December. There has been a significant growth in volumes following the good weather that has triggered increase in green leaf delivery at the factories, according to tea farmers.

“Out of 178,260 packages (11,520,000 kilos) available for sale, 169,760 packages (10,970,969 kg) were sold with 4.76 per cent packages remaining unsold,” Mudibo said.

The Tea directorate last week said the prices of the beverage would go up in the coming sales after poor performance last week.

Tea production rebound follows a sharp decline in the first quarter of the year that saw green leaf on the farms fall by almost half. Kenya exports more than 95 per cent of its tea with only five per cent consumed locally.

The directorate has, beginning this month, embarked on a three-year market campaign in Russia which is currently the world's largest importer of tea. Kenya, which controls slightly under 10 per cent of the Russian tea market, is looking to grow its share to over 30 per cent over the three-year period.

"The directorate is also planning to grow Kenya's share in China, Japan, USA, Iran and UK. We are developing country specific strategies that will give a road-map to Kenya in achieving significant growth in these markets," the directorate told the Star.






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