Investors now drink to a free tea sector in Kenya – Business Daily
Workers sort tea leaves at the loading bay at a factory. FILE PHOTO | NMG
In early 2000, the family of late ambassador Ernest Lang’at wanted to set up a factory that would produce other types of tea other than the traditional black Crush-Tear-Curl (CTC) variety.
It was, however, impossible at the time since leaf processing was in the firm control of the government under the then Kenya Tea Development Authority (KTDA) before it was later changed into an agency.
Fast forward to 2008 and the tea sector was unshackled giving the family a long-waited opportunity to fulfill their dream of establishing a specialty tea factory-Ernest Tea.
The same year, the Tea Act-CAP 343 laws of Kenya was repealed to allow private players to venture into the cash crop for the first time in the country’s history, taking the monopoly away from the KTDA.
“We now have many factories that have emerged since the liberalisation of the tea sector in the country, this has not only driven up the quality of tea but also increased production in the country,” said James Marete, a technical advisory officer at the Tea Board of Kenya.
Mr Marete said liberalisation has improved the management of tea factories by allowing farmers to play a rightful role in decision-making, generated high levels of value-added tea that has improved farm-level incomes and increased processing capacity that has bridged the gap between takings of the smallholder and large estates at the farm level.
Private factories have played a significant role in addressing the plight of farmers who previously would throw away their produce for lack of market. These firms have increased capacity, playing a significant role in absorbing extra green leaf from producers.
Ernest Tea Cottage Factory in Kericho is now one of the privately owned processors that is competing with established players such as the KTDA in the export market for specialty teas.
Rosemary Rop Lang’at, one of the directors at the factory, says liberalisation of the tea industry came as a blessing to them. “Liberalisation was the best thing that happened to us, with our own established factory, we can now compete with other big players in the market,” said Ms Lang’at.
Chairman Independent Tea Producers Association Collins Cheruiyot said these private factories have played an important role in value addition of tea. He said of the 22 members, at least 12 are adding value to their beverage before it is released to the market.
Mr Cheruiyot said governments’ regulation has come in to help independent tea producers as they have representation with the tea board and some of the industry associations that have actually come in place, noting that presently they are recognised by the East African Tea Trade Association.
“I think for us as members of the Independent Tea Producers, one of the major positives is the fact that we now are recognised as a significant player within the tea industry which was not the case before,” he said.
Mr Cheruiyot with his family manage three independent factories- Kuresoi, Bureti and Mbogo Tea plants that are all located in Kericho county.
Just like Earnest Tea, there are over 20 factories that are making specialty teas with a focus on the export market. Consumption of this variety is still low in the country courtesy of prohibitive prices making them way above the reach of Wanjiku.
Specialty teas are the most expensive because of the limited volumes produced against high global demand.
For instance, a kilogramme of white tea will fetch as much as Sh7,000 while purple tea will earn a factory Sh1,200 for half kilogramme packet. This is against Sh260 that a kilogramme of black tea is selling at in the auction currently.
In Murang’a county, Gatanga Industries has emerged as one of the largest cottage industries that purely deals in specialty teas.
The firm specialises in purple tea though they have a range of other specialty products such as white beverages.
Specialty and orthodox teas are known for their antioxidant qualities, which comes with some health benefits that include fighting cancer, lowering of weight, hair loss, and reduce the risk of a heart attack.
Siomo Tea Factory in Bomet County is an independent family business established in 2016 and is at the moment producing black CTC tea purely for export. Plans are, however, underway to put up specialty lines in coming years.
“Ours is a three-line factory but we currently have two that have been installed,” said Robert Koech, managing director at Siomo.
The factory has been gazetted as an Export Promotion Zone (EPZ) implying that all the tea that is processed there is meant for foreign markets.
KTDA has 12 factories that are currently making orthodox tea and it wants to roll out the processing of this type of beverage to all its plants.
The agency has been producing about five million kilogrammes from the factories where the special processing lines for this tea have been installed.
Kenya is the only nation in the world that produces purple tea, but the country is yet to tap its full potential even with the yawning market.