On Thursday, the Kenya Tea Development Agency (KTDA) paid KES 5.5 billion to smallholder tea farmers for green leaf deliveries in December 2022.
The figure includes mini-bonuses for the half-year period ending December 31, 2022.
Farmers can expect payment into their accounts in the coming days, according to KTDA, depending on the processes and timelines of their respective banks.
“Farmers have been waiting for this payment, and we have made it right before schools open to enable our farmers to meet their back-to-school obligations alongside other personal obligations,” KTDA Holdings chairman David Ichoho said.
KES 2.7 billion is the payment for mini bonuses for the factories whose directors passed resolutions to pay mini dividends to their farmers.
The remaining KES 2.8 billion will compensate farmers for the December green leaf delivered to factories.
Farmers will be paid between KES 5 and KES 10 per kilo of green leaf delivered to their factories during the six months ending December 31, 2022.
The KES 2.7 billion mini bonus payment is equivalent to 449 million kilos of green leaf delivered to KTDA-managed factories over six months.
KTDA MS, a subsidiary of KTDA Holdings, manages 71 tea factories on behalf of smallholder tea farmers across the country.
It was established in 2009 as a private company under Kenyan law (CAP 486) to manage smallholder tea factories on behalf of farmers.
Ichoho stated at a press conference in Nairobi that average tea prices for KTDA at the auction were KES 326 per kilogramme of made tea, up from KES 306 during the same period in the 2020-21 fiscal year.
“As part of the reforms, we promised our farmers that they will receive their pay by the 5th of the month, a promise we have dutifully kept. We have delayed slightly this month to enable us to compute the proper amounts to pay to farmers,” he added.
During the period under consideration, funds for these payments were generated through the sale of tea.