KTDA explains drop in tea bonus, blames global market and currency changes
In the East of the Rift, Kiambu fetched Sh371 per kilo, down by 46 shillings; Murang’a earned Sh376, a drop of 42; Nyeri earned Sh388, down by 42; Kirinyaga earned Sh400, down by 38; Embu earned Sh404, down by 34; and Meru earned Sh381, down by 46.
The Kenya Tea Development Agency (KTDA) has addressed concerns over lower-than-expected second payments, commonly called bonuses, for tea farmers this year, citing international market trends and currency fluctuations as the main reasons for reduced earnings.
KTDA in a statement on Tuesday explained that in 2024, the Kenya Shilling traded at an average of 144 to the US dollar, while in 2025 it averaged 129.
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This weaker exchange rate meant that even when global tea prices were stable, the amount received in local currency was considerably lower.
Regionally, average prices for tea reflect these challenges. In the East of the Rift, Kiambu fetched Sh371 per kilo, down by 46 shillings; Murang’a earned Sh376, a drop of 42; Nyeri earned Sh388, down by 42; Kirinyaga earned Sh400, down by 38; Embu earned Sh404, down by 34; and Meru earned Sh381, down by 46.
In the West of the Rift, Kericho earned Sh245, down by 101 shillings; Bomet Sh209, down by 85; Nyamira Sh266, down by 106; Kisii Sh246, down by 95; and Nandi/Vihiga earned Sh208, down by 66. These are made tea prices, and when converted to green leaf using the 4.4 ratio, they explain the reduced payments to farmers.
KTDA noted that differences in second payments between the East and West of the Rift stem from quality, market conditions, and cost factors.
Tea from high-altitude zones usually fetch better prices due to qualities that appeal to global buyers. Conversely, some factories in the West of the Rift faced lower global demand and higher operational costs, affecting net earnings.
Independent producers and plantation companies outside KTDA reported similar difficulties, confirming that these disparities are market-driven and not unique to KTDA-managed factories.
The agency warned against politicising tea matters, emphasising, “Bringing politics into factory operations only harms farmers. The surest way to safeguard incomes is through maintaining high quality green leaf, disciplined factory management, and adherence to good agricultural practices.”
KTDA explained that the final payment to farmers is calculated after deducting monthly remittances and operational costs, including processing, marketing, and logistics.
“While understandably disappointing to many, this year’s final is a direct reflection of global trading conditions beyond KTDA’s control,” the statement said.
Looking ahead, KTDA is implementing strategies to protect farmer incomes. The agency is expanding orthodox tea production, which earns higher prices in niche markets. It is also collaborating with the government to promote value addition, lower packaging costs, and open new markets such as China.
Investments in factory modernisation and energy efficiency are also underway to cut costs and enhance competitiveness.
KTDA assured farmers of its commitment, stating, “The challenges we face are global and systemic, but by focusing on quality, efficiency, and innovation together, we will overcome them and secure better earnings in the future.”
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