Tea Brokers East Africa Limited data shows that 29.7 percent of the teas that were offered for sale in the latest sale last week were taken out of the trading floor as the price of the beverage dipped.
The latest decline marks the lowest price to have been attained since the beginning of the year, pointing to a low return for farmers in the financial year ending June.
Russian traders extended their absence at the market for a second month in a row following the ongoing war between Moscow and Kiev.
Traders continue to withdraw high volumes of tea from the auction as the price of the commodity continues to falter in the wake of low demand.
Tea Brokers East Africa Limited data shows that 29.7 percent of the teas that were offered for sale in the latest sale last week were taken out of the trading floor as the price of the beverage dipped to $2.24 (Sh260) down from $2.39 (Sh277) in the previous sale.
The latest decline marks the lowest price to have been attained since the beginning of the year, pointing to a low return for farmers in the financial year ending June.
“Only fair demand for the 199,077 packages (13.13 million kilos) in the market at irregularly lower rates with more teas neglected–29.74,” said the brokers.
The price of the beverage has been on a steady decline in the last three sales, to sell below the government-backed minimum figure of $2.43 that was put in place last year in June to protect grower’s earnings following a streak of poor prices.
The minimum price, however, is only applicable to tea from Kenya Tea Development Agency, the least amount that buyers are supposed to pay.
Russian traders extended their absence at the market for a second month in a row following the ongoing war between Moscow and Kiev.
Russia has been slapped with sanctions by European countries and the US. Some sanctions include the exclusion of Moscow from SWIFT — a payment system that allows banks to transact with other financial institutions.
The US has also banned the Central Bank of Russia from trading in dollars, a move that will make it difficult for the country to trade commodities with the world market as most global trade is conducted using the greenback.
Traders are jittery of selling tea to Russia, which is one of the top 10 buyers of Kenya’s beverage, for fears that it will take them long to get payments for supplies made as the business is normally transacted in dollars.
