Farmers earned KES 5 billion more from tea sales in the eight months to August due to a strong dollar and an increase in unit price, despite a 22% drop in export volumes by Kenya’s top buyers of the beverage.
According to the tea directorate, export earnings increased to KES 88 billion in the review period, up from KES 83 billion the previous year.
The average exchange rate for the dollar during the review period was KES 116, up from KES 108.75 previously.
The unit price increased by 28 percent in the first eight months of the year, rising to $2.51 from a low of $1.95 last year.
Tea exports to the global market fell from 389 million kilos in the first eight months of last year to 303 million kilos in the review period.
According to the directorate, the Russian-Ukrainian war has continued to cause recession in major economies, including those that are key buyers of Kenyan beverages.
“Decline on exports was majorly due to effect of Russia-Ukraine crisis that continued to cause global economic recession and thus negatively affecting purchasing power in most markets,” said the directorate.
Due to economic challenges, all three of Kenya’s top beverage buyers saw a significant decrease in purchases.
The volume of tea exported to Pakistan, Kenya’s top buyer, fell by 18 percent in the review period to 121 million kilogrammes, with Egypt and Pakistan experiencing drops of 28 percent (48 million kilos) and 30 percent (23.6 million kilos), respectively.
Pakistan purchases nearly 40% of total tea exports, despite the country’s economic turmoil, which has resulted in low uptake this time around. In the aftermath of a weakening rupee, Pakistan urged its citizens to reduce tea consumption and limited the amount of money that importers could access from banks in June.
Russia, which was the fourth largest buyer of the beverage until April of this year, saw a 38% drop in purchases, dropping to seventh place on the list of top buyers.
Kenya has been scouting for new buyers over the years in order to reduce reliance on traditional customers and seek other buyers such as Nigeria, Zambia, Estonia, New Zealand, Burkina Faso, Gabon, and Senegal.
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