Commodities

Weak price fears hit tea sales at Mombasa auction

tea

A worker picking tea. FILE PHOTO | NMG

geraldandae

Summary

  • Tea prices during the sale declined to Sh208 per kilo from Sh206 in the previous sale, to mark the first decline in the last four sales.
  • Tea volumes continue to decline at the auction with the quantities dropping from 8.4 million kilos to 8.2 million kilos, marking the third time in a row that the volumes have been going down.
  • Tea regulator has said the volumes of tea will remain low in the coming months occasioned by cold season witnessed in June and July and the expected cessation of rains.

The volume of tea presented for sale at the Mombasa auction continued to slide this week on weaker prices, eroding the gains of high earnings over the past month.

Data by the East African Tea Traders Association (Eatta) —which manages the exchange — shows the volume of tea offered for sale this week dropped by at least 18 per cent, a substantial increase from the previous week when traders withdrew 14 per cent of the lot that had been lined-up for the auction catalogue.

According to Eatta, traders anticipating better prices in next week’s auction withdrew 1.7 million kilogrammes out of the 9.9 million that had been marked for sale this week.

“Out of 9.9 million kilos available for sale, 8.2 million were sold with 17.65 per cent remaining unsold,” says Eatta.

Tea prices during the sale declined to Sh208 per kilo from Sh206 in the previous sale, to mark the first decline in the last four sales.

Tea volumes continue to decline at the auction with the quantities dropping from 8.4 million kilos to 8.2 million kilos, marking the third time in a row that the volumes have been going down.

Tea regulator has said the volumes of tea will remain low in the coming months occasioned by cold season witnessed in June and July and the expected cessation of rains.

Demand of tea in the world market has remained depressed because of Covid-19 disruption, which has interfered with the movement of the commodity.

Tea exports to Kenya’s major markets dropped by 14 million kg in seven months to July when compared with the same period last year as the commodity continued to face market restriction overseas.