KTDA revenues rise to Sh24bn on reforms
Kenya Tea Development Agency (KTDA) revenue grew to 23.76 billion in this financial year compared to Sh22.96 billion achieved last year, registering a 3.5 per cent increase.
According to the company’s financial report, the increase was a “clear demonstration of the benefits of the implementation of the tea reforms instituted in 2021.”
Factories generated Sh1.97 billion in revenue this year compared to Sh1.8 billion earned in the corresponding year, registering a nine per cent increase.
Though green leaf production decreased due to reduced rainfall in tea growing zones, farmers' earnings were higher under the new tea reforms.
Total payment to farmers was Sh62.89 billion compared to Sh44.15 billion realized last year which is a 42 per cent increase.
Green tea lea production across all 57 factories stagnated at around 1.25 billion kilogrammes due to low rainfall amounts experienced in tea-growing areas.
The price of green leaf per kilogramme also increased from Sh34.71 to Sh50.18.
Global trade
The report further indicated that though the world continued to suffer the effects of the Covid-19 pandemic, although on a lesser scale than in the previous year, it continued to disrupt global trade and logistics.
“Gradual opening of the global and local economies through easing of lockdowns as well as intensified the push for reforms in the sector that help offload more tea stocks at slightly higher prices,” said Mr David Ichoho, the tea agency chairman.
He went on to note that the reforms championed by the current board had started paying off through a developed cordial relationship established with relevant arms of the government to ensure that farmers get maximum benefits from their tea business.
Further, Mr Ichoho said that as a result of the reserve price mechanism, a kilogramme of tea from KTDA-managed factories fetched an average of Sh340.55 (USD2.76) compared to Sh268.9 (USD2.18) achieved last year. “This price influenced the overall performance of KTDA subsidiary companies as well as the second payments made to farmers at the end of the financial year,” he said.
Tea reforms that were championed last year have started bearing fruits as for the first time, farmers received their second payment otherwise known as a bonus in July after the close of the financial year.
Previously, farmers received their payments in October.
Also, the tea agency has gotten into partnership with the Ministry of Agriculture to provide tea farmers with subsidized fertiliser to enhance the quality of tea produced.
“We have also increased the monthly payment for our farmers to ensure that they are able to meet their financial obligations. Every farmer is now receiving their pay on day five of subsequent months as opposed to day 20 every month,” noted Mr Ichoho. BY DAILY NATION
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