Severe winter in the West boosts Kenya tea exports

An upsurge in purchases by consumers in Europe, north America and the middle East seeking to build up their beverage stocks during the winter period helped to grow Kenya’s tea exports over January.

Statistics released on Wednesday by the industry regulator indicated export volumes in January increased 12 per cent to 39.2 million kilogrammes compared to the same month the previous year.

“There was also significant growth in Kenya tea exports to most market destinations in Europe, North America, and Middle East due to increased demand occasioned by higher consumption during the winter season,” Tea Board of Kenya (TBK) managing director, Sicily Kariuki said in a statement.

The western world experienced a severe winter which triggered massive disruptions of transport systems in several countries and even caused damage to key infrastructure facilities.

The adverse weather conditions have tended to work in favour of beverage commodity producing nations such as Kenya with consumers in the countries affected by winter preferring to take tea and coffee to keep warm.

The winter-triggered demand could prove a further boon for local farmers given the global market is experiencing shortages of the commodity, which has in part led to high tea prices that stood at an average of $2.99 a kilogramme in January compared to $2.31 in January 2009.

Tea production grew 47 per cent to 37.7 million kilogrammes compared to the same period last year, thanks to favourable rains.

The weatherman expects the country to receive above normal rainfall between March and May, which means that Tea production is set to maintain an upward movement.

The optimism over production together with high tea prices should guarantee farmers tidy earnings and the country increased flow of foreign exchange.

The top five export destinations including Egypt, which accounted for about 20 per cent of the export volumes, UK, Pakistan, Afghanistan and Sudan (1.9 million kilogramme) accounted for 74 per cent of Kenya tea export volume.

Among the five export destinations, Afghanistan recorded the highest growth at 64 per cent compared to the same period of 2009, adding to Kenya’s dilemma in the wake of protests from once leading buyer of Kenyan tea--Pakistan.

Pakistan claims that the sudden upsurge in imports by Afghanistan is fuelling smuggling of tea into her market.

The Pakistani Tea Association recently said that close to 70 million kilogrammes of the commodity was illegally smuggled into the country every month through the Afghan Transit Trade Agreement (ATTA) that offers concessionary trade terms.

The ATTA was initiated in 1965 as part of a deal by Pakistan to help its landlocked neighbour open up to international trade.