This year’s lower payments in tea bonuses were largely influenced by external market dynamics, Agriculture Principal Secretary Dr Paul Kipronoh Ronoh has said.
He made the remarks against the backdrop of concerns raised on the recently declared final green leaf payments for the 2024/25 financial year by Kenya Tea Development Agency (KTDA) factories, even as he said that its disbandment is not the solution.
Amid complaints over the process of testing, Ronoh said the Government is establishing a Tea Quality Analysis Laboratory in Mombasa to provide a scientific method of valuing tea and validate the quality and safety of Kenyan tea, currently complete and awaiting equipment for operationalisation.
He said establishment of a green leaf quality guidelines/standards to provide the minimum standard of green leaf is underway.
“It is important to emphasize that this year’s lower payments were largely influenced by external market dynamics. The appreciation of the Kenya shilling against the dollar from an average of 144.21 to 129.37, the decline in global tea prices from USD 2.69 to USD 2.46, rising production costs, and the disposal of carry-over stocks at lower prices following the removal of the reserve price have all contributed to reduced earnings, with some regions— particularly the West of Rift—being more adversely affected,” said Ronoh, in a statement.
He dismissed claims that some farmers received only Sh10 per kilo of green leaf, saying this represents only part of the payment.
The PS insisted that farmers have already received an initial Sh23–25 per kilo, bringing the total average payment for 2024/25 to Sh56 per kilo, with the lowest-earning factory paying Sh33.58.
Beyond the macroeconomic factors, Ronoh said that the Ministry acknowledges the urgent need to address governance, accountability, and transparency challenges within KTDA.
He explained that farmers have voiced strong concerns about price disparities between the East and West Tea Blocks, questionable expenditures, excessive sitting allowances by directors running into tens of millions, and weak internal controls that continue to erode farmer confidence.
“What is required is comprehensive restructuring of its governance and operational framework. Stricter oversight of directors’ expenditures, firm limits on allowances and meetings, stronger internal controls, and full financial accountability will be enforced to restore farmer trust. It must also be understood that differences in bonus levels between East and West of Rift are not a matter of discrimination, but of market dynamics linked to quality differentials and cost of production,” he explained.
The PS said the government is putting in place interventions to address challenges in the sector and complement a wider package of reforms already underway.
These include implementation of the Strategic Tea Quality Improvement Programme (STQIP) to support factories producing lower-quality teas to meet global standards and removal of VAT on tea and packaging materials to promote value addition and local packaging at source.
He said the Government is providing subsidized fertilizer to reduce production costs in addition to recovery of Sh2.7 billion held in collapsed banks to enhance farmer liquidity and KTDA is hereby directed to release these funds to the tea farmers not later than October 15.
“There is ongoing modernization of tea factories, supported by provision of Sh3.7 billion, to increase efficiency and boost production of high-value teas. There are also intensified international trade diplomacy, including under AfCFTA, to expand and diversify markets for Kenyan tea,” he explained.
The PS said that only sustainable, long-term reforms will safeguard the livelihoods of smallholder tea farmers, noting that tea sustains over 10 million Kenyans.
“Short-term reliefs are not enough. We must address systemic issues; quality, governance, cost of production, and fair market access if farmers are to truly benefit,” he stated.
According to the PS, farmers over the last year, have benefited from subsidized fertilizer supplied at Sh2,500 per bag, a Sh2 billion refund on earlier fertilizer costs in December 2024, removal of taxes on tea and packaging materials in the 2025 Finance Bill to promote value addition, recovery and release of Sh2.7 billion held in collapsed banks, and the allocation of Sh3.7 billion to modernize and retool aging factories.
He also said the government has expanded international market access in China, Iran, the USA, and Europe, restarted the stalled Chemosit hydro power project to reduce processing costs, distributed over 400,000 new high-yield tea varieties to farmers, reviewed the Tea Act 2020 to allow direct sales from factories, separated satellite factories such as Chelal, Litein and Motigo and completed the Tea Quality Analysis Laboratory in Mombasa which now awaits equipment for operationalization.
“The government has directed the push for the sale of over 100 million kilograms of tea that have remained in storage for three years, while revoking the licenses of hawkers whose activities undermine the formal tea trade,” he stated.
