The price of tea at the Mombasa auction declined marginally in the latest sale as the volumes of the commodity continue to rise in the market.
East African Tea Trade Association (Eatta) said the price of the beverage per kilogramme decreased to Sh282 from Sh283 in the previous sale.
The decline in price in the latest auction was occasioned by high volumes during the sale, which was 309,000 more when compared with the previous trading. The quantities of tea at the auction have been on an upward trend in the last four weeks.
The low price saw 2.1 million kilogrammes of the total tea offered to the market for sale withdrawn from the auction and will be re-offered for trading this week if the value will be in favour of the sellers.
Traders normally withdraw tea from the auction floor when the prices are down but offer it back for sale in subsequent auctions seeking to gain from higher buy bids.
“There was a fairly good demand for the 197,610 packages (12.9 kilos) offered for sale with 165,310 packages (10.8 Kilos) being sold,” the association, Eatta, said.
The minimum price set by the government in August last year pushed up the price of the beverage at auction, lifting it from lows of less than Sh200.
The previous low prices had subjected farmers to losses as they were selling their produce lower than what they were spending on production.
Export earnings from tea hit Sh136 billion last year when compared with Sh120 billion that was recorded in 2020.
The performance was driven by higher volumes which compensated for low international prices in the first eight months of 2021.
The volumes sold hit a high of 558 million kilogrammes last year, rising from 518 million kilos in the previous year.