Kenya’s Tea Farmers Face Declining Bonuses and Growing Regional Disparities as Global Market Pressures Mount. 

NAIROBI, Kenya – Tea farmers across Kenya are reeling from a sharp decline in their annual bonus payments, raising alarms over market sustainability and persistent regional inequities in the country’s most important cash crop.

The Kenya Tea Development Agency (KTDA), which manages 77 factories on behalf of roughly 680,000 smallholder growers, confirmed in its interim report that payouts for the financial year ending June 30 have fallen significantly compared to last year. Farmers earned between Kes 0.80 and Kes 19.10 less per kilogram of green leaf delivered, with wide disparities between regions intensifying frustrations on the ground.

Sharp Drop in Payouts

Factories in the East of the Rift Valley, particularly those in the Mt. Kenya region, will issue second payments, commonly known as bonuses, ranging between Kes 26 (US$0.20) and Kes 57 (US$0.44) per kilogram. By contrast, producers in the Rift Valley and South Nyanza are receiving only Kes 10 (US$0.077) to Kes 32 (US$0.25), the lowest levels recorded in recent memory, according to Business Daily.

The contrast is stark: Embu’s Rukuriri Tea Factory leads nationally with Kes 57.50 (US$0.44) per kilogram, though that too is down from last year’s Kes 61.50 (US$0.48). Meanwhile, farmers supplying Kiamokama and Rianyamwamu factories in Kisii County will earn just Kes 10 per kilogram, half of what they received in 2023. In Murang’a, Kiru Tea Factory’s bonus dropped from Kes 51.10 (US$0.39) to Kes 32, reflecting the broader slump.

Mounting Frustration Among Farmers

The uneven earnings have sparked anger across the tea belt. “The disparities are longstanding and must be addressed urgently,” said Cheruiyot Baliach, KTDA’s Zonal Director for Kaptebenget. Kericho Governor Erick Mutai has called for the creation of a second auction center in the South Rift, arguing that localized markets could help stabilize prices and narrow the regional payment gaps.

For many smallholders, who depend heavily on tea for household income, the decline has deepened financial uncertainty. With school fees, farm inputs, and living costs rising, the reduced bonus represents not just a lost profit, but a direct hit to livelihoods.

Global Headwinds Undermining Kenya’s Tea

Kenya remains the world’s leading exporter of black tea and the second-largest producer after China. Yet its heavy dependence on bulk exports sold through the Mombasa auction leaves farmers vulnerable to swings in global supply and demand.

Oversupply from major producers such as India and Sri Lanka has exerted downward pressure on prices. At the same time, economic turmoil in key markets, including Pakistan, Sudan, Russia, and Ukraine, has curtailed demand for Kenyan tea.

Currency fluctuations have further complicated the picture. While a weaker shilling boosts export earnings when converted into local currency, farmers face higher costs for imported essentials such as fertilizer and fuel, eroding potential gains.

Climate Change Adds to the Strain

Long-term concerns are also clouding the outlook. Kenya’s tea sector, largely rain-fed, is increasingly vulnerable to climate variability. Shifting rainfall patterns and prolonged dry seasons are already disrupting yields, with scientific projections warning of up to a 25 percent production decline by 2050 if current trends continue.

Moves Toward Diversification and Reform

In response, the government and industry stakeholders are pushing to diversify Kenya’s tea portfolio. The country recently launched its first auction for orthodox teas, a higher-value product aimed at premium markets. The Tea Board of Kenya has licensed 34 factories to produce orthodox varieties, with an ambitious target of raising value-added exports from the current 5 percent to at least 50 percent.

Officials hope the strategy will cushion farmers from the volatility of the bulk tea market while expanding Kenya’s global footprint beyond traditional buyers.

Yet for now, the immediate concern remains the shrinking payouts hitting growers across the tea belt. Unless structural reforms and market diversification efforts take root quickly, Kenya’s smallholder farmers, who form the backbone of the industry, risk further erosion of earnings and widening inequities across regions.