Transcript Agriculture, Fisheries and Food Authority (AFFA)

Agriculture, Fisheries and Food Authority(AFFA)
TEA DIRECTORATE
TEA MARKET DEVELOPMENT IN
KENYA
Samuel Ogola
Technical Services Manager-Tea Directorate
Contribution to Economy
Tea Contributes immensely to socio-economic development of the
country:
• It is the leading foreign exchange earner-23% of the total foreign
exchange earnings.
• 4% of the GDP.
• livelihood support to over 5 million Kenyans.
• Contributes to Rural development.
• In 2013, the tea industry earned the country Kshs. 114 Billion (Usd
1.33 Billion) in export earnings and Kshs. 22 Billion (Usd 0.26) in local
sales.
Role In the Industry
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Regulation and compliance
Industry planning and development
Industry advocacy
Trade and promotion
Organizational capacity and service
delivery enhancement
Key Industry Statistics
2011
Total
2013
639,521
627,938
614,159
606,744
595,152
575,103
32,777
32,786
39,056
Total
187,855
190,717
198,657
Smallholder
123,385
124,985
127,352
64,470
65,732
71,305
104
105
107
64
64
64
40
41
43
No.of Growers Smallholder
Plantation
Hectarage
2012
Plantation
Total
No.of factories Smallholder
Plantation
Stabilized Production levels
(Million Kgs)
500
y = 20.6x + 316.4
450
399
400
Made Tea (Million Kgs)
350
377
369
2011
Year
2012
432
314
300
250
200
150
100
50
0
2009
2010
2013
Export Trends (Million Kgs)
600.00
494.35
500.00
441.02
421.27
430.20
2011
Year
2012
Million Kgs
400.00
342.48
300.00
200.00
100.00
0.00
2009
2010
2013
Increasing Export Values (billion
K.sh)
120
109
100
112
114
97
Billion K.sh
80
69
60
40
20
0
2009
2010
2011
Year
2012
2013
Efforts to Grow Exports(2009-2013)
25%
22%
20%
15%
10%
10%
8%
7%
6%
5%
1%
0%
PAKISTAN
-5%
EGYPT
-1%
UK
AFGHANISTAN
SUDAN
EMERGING
TOTAL
Improving Local Consumption (Million
Kgs)
30
26
25
MILLION KGS
20
22.7
18
19
20
15
10
5
0
2009
2010
2011
2012
2013
MILLION KGS
Global Supply/Demand Trend (Million Kgs)
5,250
5,000
4,750
4,500
4,250
4,000
3,750
3,500
3,250
3,000
2,750
2,500
2,250
2,000
1,750
1,500
1,250
1,000
750
500
250
2004
2005
2006
2007
2008
Supply
2009
Demand
2010
2011
2012
2013
0.00
Auction No.
14-30
14-28
14-26
14-24
14-22
14-20
14-18
14-16
14-14
14-12
14-10
14-8
14-6
14-4
14-2
13-51
13-49
13-47
13-45
13-43
13-41
13-39
13-37
13-35
13-33
13-31
13-29
13-27
13-25
13-23
13-21
13-19
13-17
13-15
13-13
13-11
13-9
13-7
13-5
13-3
13-1
Price (USD/Kgof Made Tea)
Declining Tea Auction Prices (2013-2014-To Date)
3.50
3.00
2.50
2.00
1.50
1.00
0.50
Our Challenges
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Sustained increase in production (Black CTC
tea) leading to global oversupply.
Global supply is growing at higher rate than
demand by about 3% annually.
Slow adaptation to product and Market
diversification e.g “Orthodox ,Specialty teas etc. .
Origin Branding
Low consumption patterns in Africa.
Continued
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Declining Tea prices leading to Reduced grower
earnings (30%)
Rising Cost of Production (COP);
Many private standards and diverse regulatory
requirements by respective importing countries.
Low innovation along the value chain
Opportunities to Promote Tea
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Promotion of value addition for Kenya teas, a
target of 20% has been projected:
Increased populations in Africa and Asia
Increased awareness of health benefits of tea in
Europe and America .
Increased income levels and expanding middle
class globally .
Low consumption in Africa ,currently Africa has a
population of 1.1 Billion with a low consumption
of 0.30kg per capita
15. Continued …….
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Promotion of tea based on Origin.
Adopting product diversification and innovation
e.g Purple tea, Orthodox tea, White tea e.t.c.
Adoption of cottage Industry models to promote
specialty and niche teas segments.
Conclusion ……….
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Prepared a National Tea Policy towards improving
competitiveness and sustainability of the Industry.
Developed Kenya Climate Change Strategy for the
Tea Industry in collaboration with FAO .
Automation of the tea Auction with a view to
improving transparency and enlarge competition;
Commissioned a study on Price Stabilization Fund
(PSF)and Min. Greenleaf rate to the growers .
Thank You!
Agriculture, Fisheries and Food
Authority(AFFA)
TEA DIRECTORATE