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Mombasa tea auction in Kenya claims to lose US$ 2 million per week due to insecurity in growing zones that has caused the suspension of operations by important producers. This has created instability and uncertainty in the country’s tea business.
Mombasa tea auction in Kenya claims to lose US$ 2 million per week due to insecurity in growing zones that has caused the suspension of operations by important producers. This has created instability and uncertainty in the country’s tea business.
Business at Mombasa Tea Auction has been impacted by the continuous business interruptions in large-scale tea grower farms in Kenya’s South Rift districts, and if the current scenario continues, the nation is anticipated to lose more money in the next tea sales. The board of the East Africa Tea Trade Auction (EATTA), which oversees the Mombasa Tea Auction, said that the invasion of tea farms in the Kenyan highlands has had profound effects on the economy and that a decrease in the supply of teas for the auction is anticipated.
The issue has gotten worse after Ekaterra Tea PLc, previously Unilever, declared the suspension of its activities in the counties of Bomet and Kericho due to residents’ invasion and property destruction. The firm said that they were compelled to halt operations as a result of recent demonstrations and looting at its tea farms in the counties of Kericho and Bomet by alleged criminal gangs.
After Sri Lankan Browns Investments Plc agreed to purchase James Finlay Kenya’s tea plantations business, Tanzania signalled its desire to move the market venue for its teas from the Mombasa auction to Dar es Salaam. Finlay Industry watchers are concerned about the future of the crop in Kenya. In accordance with the terms of the selling agreement, Browns and Finlay will transfer 15% of the stock to a locally run cooperative. Large tea growers working in the counties of Kericho, Bomet, Nyamira, and Nandi have reportedly threatened to reduce their operations as a result of the increased insecurity, according to EATTA.
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According to Arthur Sewe, the head of the EATTA board, Kenya stands to lose more than $2.5 million per week if all the tea farms are closed and the Mombasa Tea Auction activities are stopped. It is important to note that tea plantations in this country account for 40 percent of the volume traded in the Mombasa auction. If plantations stop presenting their tea in the auction, the country foresees a catastrophic impact on the Mombasa Tea Auction.
