- Factory directors are set to review the year’s tea earnings before announcing the payout
- Farmers are bracing for a bonus shaped by market disruptions and rising costs
- Last year’s top-paying factories set a benchmark that growers will be watching closely
The tea farmers expect their directors to declare bonus payments for the year 2025/2026, after the close of the year on June 30.
The tea factory directors and the Kenya Tea Development Agency (KTDA) Management Service are expected to table financial documentation that will assist in the declaration of the much-awaited second payment.
In the last 11 months, farmers supplied over 1,094,710,523.06 kg of green leaf for processing compared to 1,144,364,053.46 kgs in the previous year, 2024/2025.
Last year, Rukuriri Ksh57.50, Mununga Ksh57, Gathuthi Ksh56, Imenti Ksh56, Ngere Ksh53.10 emerged the best in bonus payment.
Financial experts with knowledge in the tea industry state that the directors will be focusing on the revenue earned from the tea sold through direct sales and the Mombasa Tea Auction, and the annual expenditures among other concerns, before declaration of the bonus payment.
Factory chairpersons reached for comments acknowledged that meetings to analyze the payment are scheduled at the end of the month, as per the procedures to facilitate release of the second payment.
“At the end of the month the factory boards are expected to hold sittings in their respective areas, and declare bonus payments,” said one of the chairmen from East of the Rift.
A tea value chain expert, Peter Karomo says between July 1 and June 30 this year, the tea sector suffered major setbacks owing to the closure of the Strait of Hormuz that arose due to the America-Iran-Israel war, the price of petroleum products, among other effects.
The disruption of the shipment routes, he said, forced the teas to be delayed in reaching the markets, followed by other expenses.
“Locally, the imposition of the 0.8 percent tea levy on May 1 slowed the absorption of the premium teas into the market, a trend that led the buyers to shift to lower grade teas in the market,” said Karomo.
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To save the situation, the directors, Karomo disclosed they were forced to plead with the buyers to purchase the produce at the reduced price over fear of the accumulation of the unsold teas in the warehouses as it had happened before.
Jane Naitore, a farmer in Meru county says owing to the increased cost of living, they are expecting less than Ksh35 per kilogramme of the green leaf they supplied to their respective factories.
“We are aware of the challenges that the business has experienced in the year; let those out to incite farmers to refrain and allow the directors to declare the bonus payment,” said Naitore, who owns 6.5 acres of land under the tea.
KTDA Holding National Chairman Enos Njeru says the growers are aware of the challenges the business has endured in the year, but they have remained supportive through the production of the quality green leaf for processing in their respective factories.
“The tea bonus is paid differently based on the revenue and the production costs per factory,” he said.
On the tea levy, Njeru said the additional export charge led to the increased cost of Kenyan tea, which prompted some international buyers to reduce or halt their purchases.
“We call on the government to reconsider and remove the 0.8 per cent export levy, arguing that it is negatively affecting tea farmers by reducing their expected earnings and bonuses,” said Njeru.
Last year, Rukuriri tea factory based in Embu County led 11 factories in paying the bonus above Ksh50 per kg of green leaf. Rukuriri Ksh57.50, Mununga Ksh57, Gathuthi Ksh56, Imenti Ksh56, Ngere Ksh53.10, Gacharage Ksh51.10, Mungania Ksh51, Kathangariri Ksh50.50, Kiegoi Ksh50.20, Githongo Ksh50.10 and Njunu Ksh50.00.
By our correspondent
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