Small-scale tea growers across Kenya are expressing anger and frustration as the Kenya Tea Development Agency announces significantly reduced bonus payments for the 2024/25 financial year, with the agency citing currency fluctuations as the primary culprit.
The controversy has exposed deep-seated regional disparities in the tea sector, with farmers in western Kenya bearing the brunt of payment cuts while their counterparts east of the Rift Valley receive substantially higher rates.
According to interim reports for the financial year ending June 30, 2025, the 680,000 small-scale tea farmers countrywide face bonus reductions ranging from Sh0.80 to Sh19.10 per kilogram compared to the previous year. The disparities between regions have reignited longstanding suspicions about the fairness of the Mombasa Tea Auction system.
Regional Divide Widens
Farmers in the East of Rift region—covering the Mount Kenya area—will receive bonuses between Sh26 and Sh57 per kilogram. Embu’s Rukuriri Tea Factory leads payments at Sh57.50, though this represents a Sh4 drop from last year’s Sh61.50.
In stark contrast, West of Rift factories spanning Nyamira, Kisii, Kericho, Bomet, Nandi, and Vihiga counties will pay between Sh10 and Sh32 per kilogram. Farmers supplying Kiamokama/Rianyamwamu will receive just Sh10 per kilogram—half of last year’s Sh20.
Kiru Tea Factory recorded the steepest decline, dropping from Sh51.10 to Sh32 per kilogram—a reduction of Sh19.10 that has left farmers reeling.
The Currency Excuse
In a statement released Tuesday morning, KTDA attributed the payment decline to international market dynamics and unfavorable currency movements, specifically the strengthening of the Kenyan shilling against the US dollar.
“In 2024, the Kenyan shilling traded at an average of Sh144 to the US dollar, while in 2025 the average was Sh129,” KTDA stated. “This weaker exchange rate meant that even where international prices were stable, the amount realized in Kenya Shillings was significantly lower.”
KTDA Holdings national chairman Chege Kirundi acknowledged the difficult year following a meeting with President William Ruto at State House. “Even with increased volumes sold, the shilling has strengthened from Sh160 to Sh129 against the dollar—a huge loss for farmers,” he said.
Farmers Reject Explanations
However, farmers and their representatives are unconvinced by KTDA’s explanations, particularly regarding the persistent regional disparities.
“The huge differences in payments between factories in the West and East of Rift, which have persisted over the years, must be addressed to end longstanding claims and suspicions of manipulation at the Mombasa Tea Auction,” said Cheruiyot Baliach, a KTDA zonal director representing Kaptebenget zone in Bomet County.
Borabu MP Patrick Osero, who sits on the National Assembly Agriculture Committee, questioned how the earnings gap could be justified when all Kenyan tea is sold at the same auction. “The only alternative is to have our own auction in Kericho for the West region instead of Mombasa,” he proposed.
Kericho Governor Dr. Erick Mutai echoed this sentiment, calling for a second tea auction in South Rift to complement Mombasa. “Globally, tea from the West of Rift is known for its quality and popularity, but this is not reflected in prices and farmer earnings. That farmers here are the least paid is unacceptable,” he stated.
Quality Debate
KTDA attempted to justify regional disparities by claiming that tea from high-altitude zones naturally fetches better prices due to superior quality favored in global markets. However, this explanation has been challenged by industry experts.
Philip Ng’eno, a large-scale tea grower in Bomet East and university lecturer, dismissed quality concerns. “The issue of poor quality does not arise, because farmers adhere to the ‘two leaves and a bud’ standard set by the Tea Board of Kenya. What we must tackle are marketing challenges,” he argued.
Government Interventions Fall Short
Farmers also expressed disappointment that government support measures have failed to cushion them from losses. Baliach noted that neither the government’s tax waiver on packaging materials nor the Sh2.6 billion fertilizer subsidy has been felt in the industry.
Additional challenges cited include high electricity costs, stalled hydroelectric projects in South Rift, and the suspended reserve auction prices under the Tea Act, 2020.
Despite the crisis, President Ruto painted a more optimistic picture during his meeting with KTDA directors, noting that tea sector earnings rose from Sh138 billion in 2022 to Sh215 billion in 2024. He projected earnings could reach Sh280 billion by 2027 with continued value addition and modernization.
Looking Ahead
KTDA assured farmers it remains committed to their welfare, stating it is expanding production of orthodox teas for niche markets, working with government on value addition, and investing in factory modernization.
“The challenges we face are global and systemic, but by focusing on quality, efficiency, and innovation, together we will overcome them and secure better earnings in the future,” the agency stated.
However, with bonus payment day approaching and frustrations mounting, particularly in western Kenya, farmers are demanding concrete action rather than promises. West of Rift farmer Maxwel Mokama summed up the sentiment: “We urgently need government intervention and look forward to President Ruto’s support.”
For now, the tea sector remains mired in controversy, with 680,000 smallholder farmers anxiously awaiting their final payments while questioning whether the explanations offered by KTDA adequately justify their shrinking incomes.
