The first tea auction of 2020 at the Mombasa Tea Auction has registered the first premium orthodox tea export by Empire Kenya EPZ Ltd to Sri Lanka.
An international market decline for the cut-tear-curl (CTC) black tea has pushed Kenyan exporters to premium tea as the next best bet for the industry.
But managing director, Thushara De Silva has called on the government of Kenya to “initiate trade agreements with the country’s source markets since they charge 15 per cent tax for packaged tea, which is discouraging export of packaged tea.”
Empire Kenya’s orthodox tea shipment to Sri Lanka is specially branded with packaging depicting the Big Five animals associated with Kenya for marketing and the promotion of the country’s tourism.
The company plans to export orthodox tea to Sri Lanka, Russia, Poland and Guinea.
This year’s auction started with high sales compared with corresponding sales of January 2019. The first week at the auction posted improvements both in volumes and prices with more than 10.5 million kilogrammes of tea sold at an average price of $2.38 compared with 9.1 million kilogrammes in the first auction in 2019 at a price low of $2.33.
The Export Auction System was initiated in November 1956 in Nairobi on a very small scale with only small quantities of secondary grade teas offered fortnightly under the auspices of the East African Tea Trade Association (EATTA).
The bulk of East African tea production was directly consigned to the London Auctions. In time, East African Producer members considered it worthwhile to offer additional volume and quantity in the local export auctions.
As quantities increased, the incentive for international buying concerns to open up offices in Kenya grew. Gradually, more international buyers were attracted, spreading interest to markets other than the U.K. In 1969 it was decided by both Producer and Buyer members of the Association that, as tea was mainly warehoused, handled and shipped from Mombasa, the Auctions be moved from Nairobi to the Port of Mombasa.
Most East African tea companies currently market their tea in different food expos such as Gulf Food expo in Dubai and in Prodexpo in Russia and also make direct sales.