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Commodities

Iran traders active at tea auction amid US political standoff

Edward Mudibo
Edward Mudibo, Managing Director for East African Tea Trade. FILE PHOTO | NMG 

Iranian buyers fully participated in the first tea auction of the year amidst the ongoing political standoff between Tehran and the US, speculated to affect purchase of the Kenyan beverage.

East African Tea Traders Association (Eatta), which manages the Mombasa auction, says Iran showed a lot of interest this week with buyers fulfilling obligations for orders made.

Eatta managing director Edward Mudibo pointed out the current standoff has not affected trade at the auction with Iranian buyers expressing more interest.

“We have not seen any impact so far and Iranians are still making their orders. However, we are monitoring the situation to see if there might be a change in the coming days,” said Mr Mudibo.

Mr Mudibo said Iran lent support during the auction that saw the price of the beverage rally by five percent in the latest sale held on Tuesday to hit Sh225 from previous Sh214.

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The price increase defied high volumes seen during the sale with quantities going up by 127,083 kilos compared with the previous auction.

“Out of 178,431 packages (11,840,000 kilos) available for sale, 158,122 packages (10,509,399 kilos) were sold with 11.38 packages remaining unsold,” said Mr Mudibo.

Iran remains one of Kenya’s key markets and pays a premium price for local tea. Kenya has seen the country conduct several trade missions to Teheran in order to keep the market.

Kenya plans another tea trade mission to Iran next month as it seeks to boost sales in the Gulf country.

The volumes of tea bought by Iran have been going down in recent months as buyers delay making payments for the consignments bought, making Teheran to slide from the top 10 bracket.

In October last year, Iran was ranked number 14 in the list of the top buyers after the quantities purchased dropped by 19 percent to 386,000 kilogrammes.

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