Tea prices at the weekly Mombasa auction dipped slightly this week amid decreased demand for the commodity.
The beverage hit the lowest point to have been recorded since the beginning of the year after touching a low of Sh261 a kilogramme from Sh264 a kilogramme last week.
The beverage has lost nine per cent of its value compared with January when it traded at Sh285 for a kilogramme, with the decline attributed to diminishing demand in the market.
The low prices saw dealers withdraw 3.6 million kilogrammes of tea from the auction to trade it in the next sale should prices be in their favour.
Russia, which had started participating in the auction in the last three sales, was absent this week on the trading floor.
“Pakistan Packers and Bazaar lent good support but at lower levels with maintained activity from Egyptian Packers,” said East African Tea Trade Association.
In this week’s auction, the total volume traded was 511,255 kilos less than last week, the East African Tea Trade Association (EATTA)notes.
The price of the beverage has continued to defy the minimum price of $2.45 (Sh291.9) set by the government last year. The last time the price of tea at the auction remained above the minimum price was five months ago.
During the week, Pakistan Packers and Bazaar lent good support but at lower levels with maintained activity from Egyptian Packers, while Kazakhstan, other CIS states, and the UK showed more interest.
EATTA noted that Yemen and other Middle Eastern countries were active but selective, with a reduced enquiry from Sudan.
“Afghanistan was less active while Local Packers saw improved interest. Russia and Iran were absent. Somalia maintained enquiry at the lower end of the market,” EATTA managing director Edward Mudibo.
