By Ongaga Ongaga
The Tea Board of Kenya (TBK) has dismissed claims that it has disrupted the market and reaffirmed its role in strengthening the sector.
In a statement, the Board addressed “widespread misinformation,” underscoring that the levy is designed to stabilize farmer earnings, enhance infrastructure, and promote Kenyan tea globally.
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TBK clarified that the levy has not led to abnormal accumulation of unsold tea stocks in Mombasa.
Instead, the Board attributed fluctuations in uptake to seasonal factors such as high production from rainfall, reduced demand during summer weather, and shipping delays linked to conflicts in the Middle East.
Data shows that tea absorption at the auction remains steady, with 77 percent of teas sold in May and June compared to 70 percent in the same period last year.
Seasonal absorption rates also point to resilience, with 2026 recording 88 percent in the low production season and 82 percent in the high production season, outperforming several previous years.
On pricing, TBK dismissed claims that the levy has caused auction volatility. Il
It explained that price fluctuations are a normal market trend driven by production cycles and global demand shocks.
Average auction prices in the high production season of April–May 2026 stood at USD 2.24 per kilogram, higher than USD 1.99 in 2025 and consistent with 2024 levels.
Over the past five years, auction prices have ranged between USD 1.99 and USD 2.46 during high production periods, and USD 2.19 to USD 2.66 in low production seasons.
The Board also flagged malpractice by some players withdrawing teas even when bids matched factory ask prices, warning that such practices distort the market and harm growers.
TBK further emphasized that the levy is not charged to farmers but is a consumer tax applied at the point of export or import.
Based on the average Kenya tea price of USD 2.27 per kilogram, the levy translates to about USD 0.018 per kilogram, equivalent to Kshs. 2.36.
Half of the proceeds will go toward farmer price stabilization, with allocations also made for feeder road maintenance, tea research, and marketing.
Addressing concerns about competitiveness, TBK stressed that Kenya’s tea remains affordable compared to global peers.
While Sri Lanka, India, China, and Rwanda average between USD 3.50 and USD 4.50 per kilogram, Kenya’s tea averages USD 2.27.
Other tea-producing countries impose similar or higher levies: Sri Lanka charges between Kshs. 2.82 and 5.24 per kilogram, India applies a 5 percent GST, Bangladesh levies 1 percent ad valorem, and Pakistan imposes compounded taxes amounting to nearly 30 percent.
Kenya’s levy, at 0.8 percent of auction price, is among the lowest globally.
Chief Executive Officer Willy K. Mutai reaffirmed TBK’s commitment to building a resilient and sustainable tea sector, noting that the levy will fund value addition, market development, and infrastructure in tea-growing counties.
“The Tea Board of Kenya is committed to working with stakeholders to build a resilient and sustainable tea sector in Kenya,” he said.
The clarifications come as TBK intensifies efforts to counter misinformation and assure stakeholders that the levy is a strategic tool for industry growth, not a burden on farmers or a threat to Kenya’s global competitiveness.
