Arabfields, Mira Sabah, Special Economic Correspondent, Nairobi, Kenya — In 2025, Kenya’s tea sector, long recognized as the nation’s foremost agricultural export, delivered a performance that highlighted both resilience and persistent challenges. The country exported a total of 652,792 tonnes of tea, marking a notable increase of 4.35 percent compared to the 625,549 tonnes shipped in the previous year. This growth in volume underscored the enduring productivity of Kenya’s tea plantations, driven by favorable weather conditions in key growing regions and sustained efforts by smallholder farmers who form the backbone of the industry. Yet, despite this expansion in physical output, the financial returns told a different story, with export revenues settling at 186.9 billion Kenyan shillings, equivalent to approximately 1.44 billion dollars, reflecting a slight decline of 1 percent from the prior year.

This disconnect between rising volumes and stagnant or slightly diminished earnings stemmed primarily from a drop in the average auction price at the Mombasa Tea Auction, the world’s largest marketplace for black tea. Prices averaged 2.15 dollars per kilogram throughout 2025, down from 2.19 dollars per kilogram in 2024, a modest but impactful reduction that eroded the potential gains from higher export quantities. The Mombasa auctions, where the majority of Kenyan tea changes hands before heading to international buyers, have historically been sensitive to global supply dynamics, currency fluctuations, and shifts in demand from major importing nations. In this case, the lower prices reflected an oversupply in the segment that dominates Kenya’s offerings, namely black CTC tea, which stands for Cut-Tear-Curl, a processing method that produces small, uniform granules ideal for teabags but commanding relatively modest premiums on the global market.

Kenyan tea exports remain overwhelmingly composed of this CTC variety, accounting for fully 99 percent of the total volume produced and shipped abroad. Only a tiny fraction, around 1 percent, consists of specialty teas, often referred to as orthodox teas, which involve more traditional, labor-intensive rolling and withering processes that preserve whole leaves or larger particles, appealing to premium segments where consumers are willing to pay significantly more for nuanced flavors and higher quality. This heavy reliance on commodity-grade black tea has left Kenya vulnerable to price volatility in a market where basic blends face intense competition, and it has meant that the country captures only a limited share of the growing value in the global tea trade. Specialty teas, including green, white, purple, and various flavored or single-estate orthodox blacks, have seen booming demand worldwide, driven by health-conscious consumers, artisanal trends, and the expansion of upscale retail channels, yet Kenya has largely remained on the sidelines of this lucrative shift.

The implications of this structural imbalance became particularly evident in 2025, as the modest price decline offset the benefits of increased production, resulting in revenues that failed to keep pace with the physical expansion of exports. Farmers and cooperatives, many of whom depend on auction proceeds for their livelihoods, felt the squeeze, with lower per-kilogram returns translating into constrained incomes despite harvesting and selling more tea than before. At a national level, this stagnation posed questions about the long-term sustainability of tea as Kenya’s leading agricultural earner, especially in an economy where foreign exchange from such exports plays a critical role in balancing trade and supporting public finances.

Looking ahead, however, there are clear signs that Kenyan authorities recognize these challenges and are taking deliberate steps to reposition the industry for greater value creation. In recent years, the government has articulated a strong commitment to diversifying production toward specialty teas, with a specific target to expand installed capacity for orthodox tea processing to 200,000 tonnes by 2030. This ambition represents a dramatic leap from the current capacity of around 15,000 tonnes, a thirteenfold increase that could fundamentally alter the composition of Kenya’s tea exports. If achieved, this expansion would likely elevate the share of higher-value specialty teas well beyond the current negligible levels, allowing the country to command substantially better prices on international markets.

The introduction of orthodox teas into the Mombasa auction system in September 2025 marked an important practical move in this direction, opening a formalized channel previously reserved almost exclusively for CTC varieties. By integrating specialty offerings into the established auction framework, policymakers aim to generate greater buyer interest, foster price discovery for premium products, and encourage investment in the necessary processing infrastructure. Early indications suggest this could stimulate demand among importers seeking differentiated Kenyan teas, particularly in markets where consumers increasingly prioritize origin stories, sustainability certifications, and unique taste profiles.

Building on these initiatives, the future trajectory of Kenya’s tea sector appears poised for a potential turnaround. Assuming the government successfully scales up orthodox production capacity as planned, and provided that global demand for specialty teas continues its upward trend, revenues could begin to decouple from mere volume growth and instead accelerate through improved price realization. Even modest annual volume increases, similar to the 4.35 percent seen in 2025, combined with a growing proportion of high-value exports, might translate into revenue growth rates that significantly outpace recent performance. By 2030, a more balanced export mix could position Kenya to capture a larger slice of the premium segment, potentially lifting average prices per kilogram well above the 2025 levels and reversing the stagnation observed in recent years.

Moreover, this shift could have ripple effects throughout the economy. Higher earnings at the auction level would flow back to farmers, incentivizing further investment in quality improvements and sustainable practices, while bolstering foreign exchange reserves and supporting rural development in tea-growing regions like Kericho and Nyeri. Challenges remain, of course, including the need for substantial capital investment in new factories, training for processors skilled in orthodox methods, and marketing efforts to build Kenya’s reputation in specialty circles traditionally dominated by producers like India, Sri Lanka, and China. Climate variability, which influences yields, and geopolitical factors affecting trade routes will also play roles in determining outcomes.

Nevertheless, the foundational data from 2025, with its clear demonstration of volume potential alongside the limitations of a commodity-focused model, provides a compelling case for optimism. The targeted expansion to 200,000 tonnes of orthodox capacity by the end of the decade offers a tangible pathway toward transforming Kenya’s tea industry from one constrained by low-margin bulk exports into a more resilient, high-value contributor to national prosperity. As these reforms take hold, the coming years may well see Kenyan tea not just maintaining its status as a global leader in volume, but emerging as a stronger contender in the pursuit of profitability and sustainability on the world stage.