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TEA MARKET DEVELOPMENT IN KENYA Agriculture, Fisheries and Food Authority(AFFA) TEA DIRECTORATE Samuel Ogola Technical Services Manager-Tea Directorate.

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Presentation on theme: "TEA MARKET DEVELOPMENT IN KENYA Agriculture, Fisheries and Food Authority(AFFA) TEA DIRECTORATE Samuel Ogola Technical Services Manager-Tea Directorate."— Presentation transcript:

1 TEA MARKET DEVELOPMENT IN KENYA Agriculture, Fisheries and Food Authority(AFFA) TEA DIRECTORATE Samuel Ogola Technical Services Manager-Tea Directorate

2 Contribution to Economy Tea Contributes immensely to socio-economic development of the country: It is the leading foreign exchange earner-23% of the total foreign exchange earnings. 4% of the GDP. livelihood support to over 5 million Kenyans. Contributes to Rural development. In 2013, the tea industry earned the country Kshs. 114 Billion (Usd 1.33 Billion) in export earnings and Kshs. 22 Billion (Usd 0.26) in local sales.

3 Role In the Industry  Regulation and compliance  Industry planning and development  Industry advocacy  Trade and promotion  Organizational capacity and service delivery enhancement

4 Key Industry Statistics No.of Growers Total 639,521627,938614,159 Smallholder 606,744595,152575,103 Plantation 32,77732,78639,056 Hectarage Total 187,855190,717198,657 Smallholder 123,385124,985127,352 Plantation 64,47065,73271,305 No.of factories Total Smallholder 64 Plantation

5 Stabilized Production levels (Million Kgs)

6 Export Trends (Million Kgs)

7 Increasing Export Values (billion K.sh)

8 Efforts to Grow Exports( )

9 Improving Local Consumption (Million Kgs)

10 Global Supply/Demand Trend (Million Kgs)

11 Declining Tea Auction Prices ( To Date)

12 Our Challenges  Sustained increase in production (Black CTC tea) leading to global oversupply.  Global supply is growing at higher rate than demand by about 3% annually.  Slow adaptation to product and Market diversification e.g “Orthodox,Specialty teas etc..  Origin Branding  Low consumption patterns in Africa.

13 Continued  Declining Tea prices leading to Reduced grower earnings (30%)  Rising Cost of Production (COP);  Many private standards and diverse regulatory requirements by respective importing countries.  Low innovation along the value chain

14 Opportunities to Promote Tea  Promotion of value addition for Kenya teas, a target of 20% has been projected:  Increased populations in Africa and Asia  Increased awareness of health benefits of tea in Europe and America.  Increased income levels and expanding middle class globally.  Low consumption in Africa,currently Africa has a population of 1.1 Billion with a low consumption of 0.30kg per capita

15 15. Continued …….  Promotion of tea based on Origin.  Adopting product diversification and innovation e.g Purple tea, Orthodox tea, White tea e.t.c.  Adoption of cottage Industry models to promote specialty and niche teas segments.

16 Conclusion ……….  Prepared a National Tea Policy towards improving competitiveness and sustainability of the Industry.  Developed Kenya Climate Change Strategy for the Tea Industry in collaboration with FAO.  Automation of the tea Auction with a view to improving transparency and enlarge competition;  Commissioned a study on Price Stabilization Fund (PSF)and Min. Greenleaf rate to the growers.

17 Thank You! Agriculture, Fisheries and Food Authority(AFFA) TEA DIRECTORATE


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