Queen Nwabueze
Kenya’s tea production for the month of May 2022 rose by 4.77 million Kgs from 45.32 million Kgs recorded in the same period of 2021 to 50 million Kgs.
Join our WhatsApp ChannelCompared to the previous months, production for May was higher than 41.17 million Kgs recorded in April and 46.32 million Kgs in March.
The high out-put, according to reports by the Tea Directorate, was attributed to good weather conditions characterized by warm temperatures and enhanced rainfall.
Despite higher output in the month of May, cumulative production for the first five months of the year was lower by 3.51 million Kgs to stand at 227.09 million Kgs against 230.60 million Kgs recorded during the corresponding period of 2021.
Notably, this was due to unfavourable weather conditions experienced during the first four months of the year, lower production trend to date is likely to continue throughout the rest of the year.
Reportedly, from the total out-put, 38.85 million Kgs of tea were sold at the auction, which was lower compared to 45.84 million Kgs recorded in the corresponding month of last year.
It was also lower in comparison with 40.77 million Kgs sold in the month of April and 45.29 million Kgs sold in the month of March.
The average auction price during the month also followed the same declining trend going for 2.41 USD per Kg against 2.63 USD in April and 2.59 USD in March.
Reports say, the declining prices were due to less buying activity as several markets imported fewer quantities owing to the continued effect of the global economic shock caused by the impact of the Russia-Ukraine crisis.
As a result of the crisis, most global economies are experiencing commodity shortages, rising fuel prices, scarcity of foreign exchange reserves and depreciation of local currencies leading to soaring inflation and slow economic growth.
The crisis which started at the end of February this year came at a time when most economies were on the path to economic recovery after experiencing slow growth due to the effect of the Covid-19 Pandemic in 2020 and 2021.
Despite the global economic shock occasioned by the Russia-Ukraine crisis, the auction prices to date have remained buoyant after experiencing a declining trend to a seven-month low of 1.75 USD per Kg in July 2021.
Reportedly, from the total sold tea volumes, the country exported 36.56 million Kgs of tea during the period, 28% lower compared from 50.76 million Kgs recorded in the same period of last year.
It was also lower compared to export volumes of 39.56 Million Kgs in April and 44.43 Million Kgs in March.
The decline in export volume was majorly due to the effect of the Russia-Ukraine crisis that continued to cause the global economic recession and thus negatively affected purchasing power in most markets.
The recession not only affected the export volume but also resulted in a reduced number of export destinations especially to emerging and new markets.
According to the report, Kenya tea was shipped to 40 export destinations compared to 51 for the same period of last year.
The export markets were also less compared to 45 export destinations in the month of April and 47 export destinations during the month of March.
Pakistan maintained the leading export destination for Kenyan tea having imported 13.84 million Kgs compared to 16.22 million Kgs imported during the previous month, accounting for 38% of the total exported volumes.
Other key export destinations for Kenyan tea were Egypt, UAE, UK, Yemen, Russia, Sudan, Poland, Afghanistan, and Kazakhstan.
A few shipments were recorded in seasonal markets such as Nicaragua, Mali, Mexico, Singapore, Australia and Tanzania.
Meanwhile, local tea sales for May 2022 stood at 2.41 million Kgs against 4.15 million Kgs for the corresponding period of 2021 while cumulative tea sales for the five months period up to May 2022 were 12.45 million Kgs against 15.44 million Kgs for the same period of 2021.
Lower sales during the month and the year to date were attributed to lower demand due to the continued effect of inflationary pressure on basic commodity prices occasioned by the global economic recession, weakening of the Kenya Shilling against the USD and increase in fuel prices.
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