East Africa tea industry sees China as source of new revenue

The east Africa tea industry is seeking to expand into the Chinese market in order to boost its declining revenues, an official said on Thursday.

Edward Mudibo, managing director of the East African Tea Trade Association (EATTA) told Xinhua in Nairobi that the region is experiencing increasing production while demand for the cash crop has stagnated hence lower prices at the Mombasa tea auction.

“We plan to sign a memorandum of understanding with the Chinese tea trade association later in the year so that more east Africa tea is sold in China,” Mudibo said.

EATTA represents the interests of the tea industry in Kenya, Uganda, Tanzania, Rwanda, Burundi, Ethiopia, Democratic Republic of Congo, Malawi, Madagascar and Mozambique.

The trade association said its principal mandate is to run the weekly Mombasa tea auction center which is currently the largest tea auction center in the world and the only one dealing in teas from more than one country.

Mudibo said that the auction has more than 70 buyers but key markets are Pakistan, Egypt, Britain, Sudan, Yemen and United Arab Emirates.

He noted that if more Chinese buyers enter the tea market it will boost the price at the market and increase foreign revenues for the region.

According to the tea industry official, the Mombasa tea auction center traded over 400 million kilograms of tea valued at over 100 billion shillings (one billion U.S. dollars) in 2018.

Mudibo revealed that in July, the Mombasa tea auction witnessed the lowest average price of 1.76 U.S. per kg due to overproduction of tea.