Kenyan tea farmers are facing a difficult year, with reports indicating a significant drop in their bonuses for the 2025 financial year. This has caused concern among smallholder farmers who rely on tea sales as a primary source of income. According to the Kenya Tea Development Agency (KTDA), interim figures for the financial year ending June 30, 2025, show that farmers in 21 tea-growing constituencies earned between Ksh0.80 and Ksh19.10 less per kilogram compared to the previous year.
Disparities in Tea Bonuses Across the Country
While the drop in bonuses is widespread, it is not uniform across all regions. Farmers supplying factories in the East Rift Valley, particularly in the Mt Kenya region, are expected to receive between Ksh26 and Ksh57 per kilogram as their second payments, known locally as bonuses. However, farmers in the Rift Valley and South Nyanza are facing much lower rates, ranging from Ksh10 to Ksh32 per kilogram.
For instance, Kiru Tea Factory in Murang’a will pay Ksh32 per kilogram, down from Ksh51.10 last year. Similarly, Embu’s Rukuri Tea Factory will pay Ksh57.50, a Ksh4 reduction from 2024. In some areas, such as Kiamokama and Rianyamwamu factories, farmers will receive just Ksh10 per kilogram—half of the Ksh20 paid last year. Other regions, including Nyamache and Itumbe, will see similar reductions, with farmers earning Ksh11 instead of Ksh20.
These stark differences in payments have left many farmers frustrated, accusing the industry of perpetuating unfair practices and favoring certain regions over others.
Factors Behind the Decline in Tea Bonuses
Several global and local factors are contributing to the drop in tea bonuses this year. Despite Kenya being the world’s second-largest producer of black tea and the leading exporter, its reliance on bulk sales through the Mombasa auction makes the country’s farmers highly vulnerable to market fluctuations. Increased oversupply from competitor countries like India and Sri Lanka has reduced auction prices, further exacerbating the problem.
In addition, the economic challenges in key import markets such as Pakistan, Sudan, Ukraine, and Russia have weakened demand for Kenyan tea, putting further downward pressure on prices.
Economic Challenges and Currency Fluctuations
The local currency, the Kenyan shilling, also plays a significant role in determining the earnings of tea farmers. Since tea is traded in U.S. dollars, a weaker shilling could potentially increase returns. However, this benefit has been offset by rising costs of imported farm inputs, particularly fertilizers. To help alleviate this burden, the Kenyan government has subsidized fertilizer prices, reducing the cost of a 50kg bag from Ksh3,400 to Ksh2,500. While this has provided some relief, the overall impact on farmers’ income remains minimal due to the ongoing price declines.
Impact of Climate Change on Tea Production
Another factor contributing to the decline in earnings is climate change. Shifting rainfall patterns and longer dry seasons are already having a detrimental impact on tea production. Experts warn that Kenya’s tea yields could drop by as much as 25% by 2050 if current climate trends continue. The changing weather patterns not only affect the quantity of tea produced but also the quality, leading to lower returns for farmers.
A Struggling Industry in Need of Reform
The decline in tea bonuses is a multifaceted issue involving global market forces, local economic challenges, and environmental factors. While the Kenyan government’s subsidy for fertilizers has provided some relief, it’s clear that more needs to be done to address the underlying issues facing the industry. With climate change threatening long-term production and volatile international markets impacting demand, the government and industry stakeholders must work together to implement sustainable solutions to ensure a brighter future for Kenya’s tea farmers.
