Gachagua Hints at Higher Bonus for Tea Farmers this Year
Deputy President Rigathi Gachagua has hinted that small-scale tea farmers will get enhanced earnings this year from the sale of their produce.
Speaking when he hosted directors from Kenya Tea Development Agency (KTDA) in Karen, Mr Gachagua said the total earnings are expected to hit Ksh150 billion from Ksh138 billion in the last financial year.
The earnings could have been lifted by a high exchange rate that has seen a shilling lose over 20 percent to a dollar since January this year, a move that has favoured exporters but hit consumers on the back of expensive imports.
However, the DP attributed the growth to reforms that the government has undertaken in the tea sector.
“The comprehensive reforms we are rolling out in the tea sub-sector are bearing fruit as farmers will receive higher bonuses this year,” said Mr Gachagua on Wednesday.
“This is a notable positive outcome from the tea subsector stakeholders’ conference I chaired in Kericho in July this year which provided a much-needed platform to listen to the farmers’ concerns and agree on best interventions to improve their earnings.”
A number of factories have so far declared the final payment for their farmers with the second bonus, popularly known as bonus expected to be paid next month.
The DP said the latest development is just the beginning of reforms in the sector and that the government will not relent until the smallholder farmers get their rightful pay that’s commensurate with the work that they put in their farms.
He said President William Ruto is keen on bettering farmers earnings and has mandated him with instituting long-term reforms in the subsector.
“This year, as we fully roll out the reforms, we project the tea export earnings to rise to about Ksh150 billion up from Ksh138 billion last year,” he said, urging farmers to consider diversifying to orthodox teas.
“We can do better; the factories should diversify and explore orthodox tea production which fetches higher earnings in international markets,” the DP said.
For instance, Imenti and Michimikuru, which are among the 11 factories that process orthodox teas will pay their farmers Ksh52 and Ksh48 per kilo respectively in the financial year that ended in June 2023.
The disruption in Sri Lankan production has resulted in a significant increase in orthodox tea prices with the average cost per kilo hitting a high of Ksh700 from Ksh400 previously.