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Commodities

Ministry mulls Sh1.6 billion orthodox tea funding

Agriculture Cabinet Secretary Mwangi Kiunjuri
Agriculture Cabinet Secretary Mwangi Kiunjuri. FILE PHOTO | NMG 

The Ministry of Agriculture could provide Sh1.6 billion financing for small-scale tea farmers to diversify from black CTC tea to orthodox type in the wake of low prices.

Agriculture Cabinet Secretary Mwangi Kiunjuri says the plan involves a funding model for smallholder tea factories to set up production units.

Speaking on a local TV show, Mr Kiunjuri said this will help cushion farmers in times of low prices in the international market.

“In a bid to help our tea farmers realise better earnings, I have written to both the Head of Public Service Joseph Kinyua as well as the Cabinet, requesting the government consider the option of extending Sh1.6 billion concessional loan for putting up orthodox tea production units over the next one year,” the CS said.

Part of the reason tea farmers are always hit by low prices is relying on black CTC, of which the country is the number one exporter worldwide.

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Black orthodox tea produced using the traditional method, fetches almost double the price of CTC type. Mr Kiunjuri said financing will come with the respite of a one-year moratorium to further cushion farmers from repaying immediately.

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