Technology has delivered a sharp lift to returns for the more than 400,000 small-scale tea farmers who sell their tea to the Kenya Tea Development Authority with the roll out of automated weighing scales in all KTDA tea buying centers in the country, removing the backlogs in records, long queues on delivery and heavy overheads of the former manual system.
The introduction of the new data system comes as part of ongoing reforms within the tea agency to cut production costs and improve the earnings of small scale farmers, and follows the souring relationship between tea directors and farmers on accusations by farmers that directors were collaborating to steal from them. Last year, some farmers in Othaya, Muthithi, Kirinyaga and and Murang'a in central Kenya even uprooted their tea bushes citing the low returns.
However, the new data system is now lifting farmers’ margins in several ways, says the agency.
The period from September to March is the peak season for tea growing in Kenya and, therefore, a time when extra help is needed to cope with the sudden rush of leaf that needs to be plucked. Traditionally, employees bring in their relatives as ‘helpers’ and, since pay at the end of the month is calculated according to the kilos picked, everyone aims to pluck as much leaf as possible.
On a large scale, the tea estate benefits from extra hands to pluck leaf during the peak season whilst the worker’s family is able to earn extra income. The big concern, however, is that these ‘helpers’ are usually under age and their involvement in tea plucking for pay breaches Kenyan law and the international labour organization standards.
This trend has been in existence for long in tea growing areas in Kenya. Last year a shocking story of how tea estates in Limuru were hiring school going children of as young as ten years to pluck tea for them and paying them a pitiful 50 Ksh daily exposed the rot that has existed for long in the tea industry. Women who produce most of the tea grown in Kenya have been complaining that their contribution to the industry, which is the country's leading foreign currency earner, has always been downplayed.
While most smallholdings are owned by men, it is a common practice in Kenya that more of these farms are run by their wives, who play such crucial roles as mobilizing farm workers, participating in tea picking, weeding and tending farms, yet they have put up with discrimination and exploitation in the tea estates.
The tea industry raises a number of health and safety issues. Tea plucking can be hazardous work, resulting in back pains. Workers who cultivate and pluck tea are exposed to toxic pesticides and insecticides, insects and snakes. The work is physically demanding, because pickers must carry the bags of tea to the collection points.
Improper use of chemicals, due to lack of knowledge among the sprayers is a problem that often occurs on tea plantations. As many workers on tea plantations live with their families on the tea estates, lack of adequate housing and sanitary facilities are health and safety issues that are particularly relevant for the tea sector.
Concerns have also been raised over insufficient remuneration for tea-farm workers. On average, workers who are mostly casual workers get four shillings per kilogramme of green leaf, while salaries of permanently engaged team leaders and supervisors range within 3000 shillings and 5000 per month, depending on experience and employer.
One institution however has made it their business to ensure tea production in Kenya follows the internationally expected standards and change the grim picture that is portrayed in tea producing zones in Kenya. Ethical Tea Partnership commonly referred to as ETP is a non-profit alliance of tea companies that aims to guarantee that the tea sold by its members is produced in a socially responsible way.
Since it set base in Kenya in 1997, many tea producers, packers and blenders have hopped on board with the realization that failure to get certification from ETP would spell doom to their teas.
Negative media coverage on, for example, working conditions for women and children on tea estates have greatly influenced EU sales and EU consumers have consistently demanded more information about where the tea they consume come from and how it is produced. As a result, since 1997 a few large tea-packing companies started to work together, in what is now called the “Ethical Tea Partnership” (ETP).
The ETP since then has been striving for improvement of the social conditions under which tea is produced by monitoring and regulating the living and working conditions on the estate, or in the garden or factory of a tea producer. “Some of these violations happen consciously or unconsciously and we have been proactive in letting the tea producers know that tea has to be produced ethically,” says Ms Sarah Roberts Executive Director of ETP.
It is customary on tea estates in Kenya to search staff leaving the factory to guard against theft of company property. Security staff run their hands over an employee’s clothes to check there is nothing hidden underneath – often an uncomfortable situation for female employees when this is done by men. ETP has been negotiating with estates to ensure that a female staff member is always on duty as workers leave at lunchtime and at the end of the day.
It’s a policy which has minimised embarrassment, improved labour relations and proved cost effective for the factories, as they have switched male and female staff on the rota instead of hiring additional staff, a key factor previously inhibiting change. Tea is produced in Kenya all year round and most factories use casual workers in addition to permanent staff.
For the casual worker, it’s a precarious existence; he or she is employed on a day to day basis and if there’s no work – if the weather changes or a machine breaks down, for example – they are sent home without pay. Instead of being paid daily, casual workers are paid at the end of the month and will only receive pay for the days that have been worked, while a permanent worker will receive a full consolidated wage regardless.
Repeatedly using casual labour is against Kenyan law and is an important ETP non-conformance and a breach of standards for all of the certification schemes.
ETP has also been awarding certificates and grading individual tea estates, including tea estates in developing countries. Tea estates are graded after the monitoring visit has taken place. Grades are determined by the Partnership after the monitors’ report has been received. Grades range from A-F: grades A-C merit a certificate, grades D-E do not, Grade F Indicates a fail and estates are removed from the members’ Approved Supplier list, unless they show that they are ready to immediately work to remedy the non-conformance.
However, ETP’s mission goes much deeper. ETP believes that the success of its activities depends on how the tea packers work together with tea growers in finding creative and practical solutions to the problems that occur and therefore stimulates tea producers and tea packers to build secure and sustainable relationships. ETP also helps tea growers become aware of consumer concerns on the one hand, and works on gaining recognition from consumers who buy and drink the tea on the other hand.
Joseph Wagurah, the ETP Regional Manager for Africa, is drawing on his experience of working in the Kenyan flower industry to change this practice. He has begun negotiating with some of the largest groups of producers to persuade them to adopt a seasonal contract, where the worker is employed between set dates, renewable by mutual agreement at the end of the period, and paid as a permanent worker would be.
“The difference between the two sets of employees is the period of employment - while a permanent worker is employed on a permanent basis, a seasonal worker is employed for a defined period of time, usually the high season,” says Wagurah.
“It will take time to introduce this because of the cost implications, but it’s worth doing.
By doing this, producers will not only be taking remedial action against their own non-conformance, but will be fulfilling the aims of the ETP. It will boost the morale of the seasonal employees and hence improve labour relations and harmony in the tea sector,” says Mr. Wagurah
ETP has also rolled out various training programmes in the country which target tea factory managers and estate supervisors. Partnering with Kenya Tea Development Authority (KTDA) and Federation of Kenyan Employers (FKE), ETP has been training the factory managers and estate supervisors on social issue in their workplace for example how to detect discrimination and harassment and how to address it amicably.
The initiative has also sought to train them on legislations both local and international regarding for example child labour and exploitation and the requirements of the tea they produce in the international market.
Also in the offing is a partnership with GTZ the federally owned German organization that works worldwide in the field of international cooperation for sustainable development, for a pilot three year training programme in the highest tea producing zones in Kenya which include Central Kenya and Rift Valley.
Meant for the tea producers the training programmes seeks to train the producers on how to adopt to the impacts of climate change and in their own unique ways mitigate climate change. “We have identified this programme as a perfect way to move from criticism to finding solutions, and since Kenya has been feeling the effects of climate change we feel we can empower the producers to be part of conserving the environment,” points out Sarah Roberts.
Written by Bob Koigi
Kenya’s tea production has leapt this year on good rains, but with its biggest market for the low-quality tea it is wedded to collapsing on the back of new trade policies, the domestic industry’s outlook is looking ever poorer.
Tea farmers have so far enjoyed a bumper year. Kenyan tea production was up by almost 50 per cent in the first quarter to 37.7m kg compared with 25.4m kg a year earlier. At the same time, tea sales at the famous Mombasa auction rose by 18 per cent, to 94.5m kg from 79.8m kg a year earlier, on prices up by 30 per cent.
But the bounce-back from the trials of drought comes against the backdrop of increasingly stiff competition for Kenya’s low-quality tea-bag tea, and the erosion of many of its top markets behind shifting international trade policies.
Kenya has for a long time been a producer and exporter of black tea processed using the automated cut, tear and curl (CTC) method of crushing leaves into granules, principally for use in tea bags. All the leaves, buds and stems are ground down to an equal size, mostly dust and fannings, producing lower quality but strong-liquoring teas, which yield a high number of cups per kilo.
This is in contrast to the orthodox teas, which are manufactured using the traditional method of gradually rolling leaf into smaller particles, to produce a higher quality, better-tasting tea suitable for multiple infusions
Kenya’s fiercest competitors in the global tea market, India and Sri Lanka have developed industries in both CTC and orthodox production, giving them a reach into the large CTC markets of the UK, Pakistan and Egypt, as well as the huge Orthodox tea market in the US.
But Kenyan tea producers remain wedded to CTC production, despite concerted efforts by the Kenya Tea Development Authority, in charge of the collection, processing and selling of tea leaves from small-scale farmers, to encourage orthodox tea production.
Kenya’s 314,875 small-scale tea farmers account for 60 per cent of the tea produced in the country, compared to 40 per cent from the large plantation farmers, such as Sasini tea. However, the processing of that 60 per cent is exclusively CTC.
Yet, according to the Tea Board of Kenya, in 2007, 3,726m kgs of black CTC tea were produced, against world consumption of just 3,600m kgs, representing an oversupply of 126m kgs.
Kenya was hit heavily by the over-supply, suffering sharp falls in both export volumes and prices, even as competitor nations such as India enjoyed continuing growth in tea sales.
“Just because we have recorded impressive sales in the Mombasa Auction this year doesn’t mean it will remain so. We produce one type of tea which is facing fierce competition from other competitors,” says Mr John Bundi of Swift Commodity Enterprise, a leading tea export firm in Kenya.
It’s a message echoed by the president of The Highland Tea Company, a wholesaler of Kenyan specialty teas and a member of the Specialty Tea Institute, based in New York City, Wanja Michuki: “those that rely on one form of tea will always be scathed because you can’t quite predict international markets”.
Kenya also lacks the buffer zone of a vibrant domestic tea market - exporting 95 per cent of the 200m kg of tea it produces annually.
“The average consumption of Kenyan tea per person in Kenya is 400g compared to the UK where average consumption is 2kg,” says Mr Bundi. “This should explain to you why Kenyan tea continues to be in a volatile position.”
By contrast, India, one of Kenya’s biggest rivals, produces most of its tea for local consumption. In 2009, India produced 30 per cent of the world’s tea, but consumed 85 per cent of that on the local market.
Kenya has also been hit by a string of new trading deals.
Pakistan was for a long time the largest importer of Kenyan CTC tea. A few years ago, Pakistan’s embassy in Nairobi sought to establish a free trade area (FTA) with Kenya that would eliminate tariffs, quotas and preferences on most of the goods traded between the two countries, top among them tea. But Kenya rebuffed the proposal, arguing it would conflict with the taxation regimes of the Common Market for East and Southern Africa (COMESA), including the East African Community (EAC) trading bloc, of which Kenya is a member.
As a result, exports to Pakistan in 2008 fell by 43 per cent, and have never recovered.
To make matters worse, Afghanistan then entered into free trade with other tea exporters including, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka under the South Asia Free Trade Area (SAFTA) banner and agreed to remove tariffs on goods traded among them. Today, Sri Lanka, another fierce Kenyan competitor, enjoys duty-free market access for 206 products into the Pakistan market, with tea high on the list.
Moreover, Pakistan is now in exploratory talks with Malawi and Rwanda seeking FTA status with alternative African tea-growing states. “When such a major importer of tea finds new markets to explore, this has serious effects and places Kenya in a precarious position where a drop in demand from any one of these countries always has a major impact on revenues from Kenyan tea exports,” says Wanja Michuki.
The Kenyan government is now pushing hard to end the overdependence on CTC teas. Dr. Romano Kiome Permanent Secretary in the Agriculture Ministry explained recently: “We need to develop special products for special markets. We need to put the consumer first, rather than the farmer, as has been the case.”
But it is a message that has yet to convert the 314,875. For now, the only hope can be that the rest of the world, or Kenya, starts consuming a lot more teabags.
Written By Bob Koigi for African Laughter
As tea producers grapple with erratic rains that have knocked tea production in the first quarter, the local tea market has moved into sharp take-off, according to the half year report from the Tea Board of Kenya.
In the year to June 2011, local tea consumption jumped by a full 16 per cent, rising to over 10m kgs up from 8.6m kgs in the previous 12 months, in a surge that is being attributed to sustained promotional campaigns by the tea board and intensive brand promotions by tea packers.
“Factory gate sales have also provided an awareness platform and encouraged repeat sales at the grass root level,” said Tea Board of Kenya Managing Director, Mrs. Sicily Kariuki while releasing the report.
However, most profoundly, the rise represents a shift in strategy and marketing by the Kenyan tea industry as a whole. following from increased competition from leading tea exporters like Sri Lanka and India, coupled with price fluctuations due to global oversupply of tea.
Until now, Kenya's tea industry has been vulnerable to even the smallest wrinkles in the tea export market. Historically, some 95 per cent of Kenyan has been exported, with domestic consumption standing at just 5 per cent and individual tea-drinking standing at just 0.48 kgs a year, compared with countries like the UK, one of the export destinations for Kenya’s tea, where annual individual tea consumption stands at 2 kgs.
The challenge of converting local consumers to the joy of tea and attracting them to value-added and higher quality teas has been driven by the KTDA with the launch of T-Spot, an up-market tea house set on the ground floors of Chai House along Koinange Street in Nairobi. Run by a restaurant consultant management, Blanco's Holdings, the café specializes in serving quality tea, which includes all the teas grown in the country; and presented in every form from cookies made from tea to tea mochas.
The model has quickly gained momentum. On Loita Street, a lane away from T-Spot, is Sasini House, which not only houses the headquarters of a tea and coffee company, but now a new tea and coffee restaurant. Both tea cafes have played a role in delivering a new, more fashionable note to tea drinking, and new local tea lovers.
“These interesting and very well brewed local teas like teappuccino, chai latte and chai mocha make me pass here everyday after my job. I crave for these types of wonderful teas,” said Millicent Wairimu a 25 year old accountant working in Nairobi and customer of the T-Spot café.
As part of its diversification programme Sasini has also established another tea outlet at the newly refurbished National Museums of Kenya headquarters in Nairobi's Museum.
Alongside the new tea café model, KTDA four years ago introduced a Local Generic Promotion Campaign promoting tea as a drink in country-wide road-shows, in-store and door-to-door promotions, and aggressive media campaigns targeting the youth, middle-aged consumers, and women in both rural and urban areas who form the largest population of tea drinkers, but tend to drink tea only once per day.
The drive has also been combined with programmes by tea packers like KETEPA to encourage Kenyans to take more tea by outlining the health benefits derived from tea compared with soft drinks “The objective is to drive home the message that tea is not just a “breakfast” beverage, but one to be taken any time of the day with increased frequency for better health,” said Ms Sicily Kariuki when launching the plan.
The take-off of value addition in Kenyan tea, by adding spices like cinnamon, garlic, lemon grass, ginger, cloves and even fresh parsley and vanilla to cater for customer’s varied tastes has also endeared teas to local consumers.
Mrs Flora Mutahi, who pioneered value addition with her company Melvin Mash, insists that the most beautiful thing that ever happened to her is filling the vacuum in Kenyan stale tea by adding excitement in the local tea market. With the powerful aroma of spices wafting into the corridors of her office in Nairobi's Industrial Area, she says: “I am glad that my efforts have really spiced Kenyans life and more Kenyans now are falling in love with their Kenyan tea.”
The Tea Board of Kenya has also been pushing the government to remove Value Added Tax (VAT) on local tea to increase consumption in the country, in line with countries like Tanzania, which have long exempted their local tea from VAT, even leading to greater competition with Kenyan tea.
It’s an array of marketing that now seems to be delivering some first insulation for the country’s tea industry from the shocks of international competition, which its most vigorous competitors have always been more protected from.
India for example, one of Kenya’s biggest rivals, produces most of its tea for local consumption. In 2010, India produced 30 per cent of the world’s tea, but consumed 85 per cent of that on the local market.
Written by Bob Koigi for African Laughter
Previously, manual weighing machines required some eight clerks in buying centers to carry out the record keeping, which was at times cumbersome and often saw records lost in the high volume of paper work. The electronic weighing solutions, as the technology is known, has converted 40 days work into 1 day’s work for one clerk.
For the farmers previously expected to foot the bill for the weighing clerks, this has delivered a significant drop in overheads. “The good thing with this technology is that even drivers who have not enjoyed formal schooling can operate it easily. We have around 30 drivers who are operating the EWS and they have never had a problem with it.
You can imagine in a tea buying centre that had 8 clerks, all of them replaced by the machine and the driver knowing how to operate it. This is one of the best things that have ever happened to farmers,” says Mr. Fred Gori Corporate affairs manager at KTDA.
The biggest change, however, is in the accuracy of the records. While the manual machines only recorded the whole figure and omitted the figure after the decimal, the EWS records the precise weight, restoring to farmers substantial losses that were being incurred.
“I will admit the number of cumulative kilos the farmers lost were astronomical. We never took kilos with decimal points, so if a farmer’s tea leaves weigh 30.90 kilos, it was assumed they were 30 kilos, so you can imagine how much they eventually lost,” said Francis Gatonye, a clerk at Githambo Tea buying centre in Central Kenya,
The technology assures accuracy of data captured and saves on time and human resource by having data captured at source, but it also makes automated reconciliations between factory weights and buying centre weights, ensuring tea is not lost along the chain.
“The solution allows for data retrieval and provides reliable backup thereby assuring integrity of green leaf information,” said KTDA’s Finance and Strategy Director, Benson Ngari.
It has also provided a data system that means management can handle grower issues at the buying centre level, including registration, loans management, payments and fertilizer queries.
The technology ensures that only valid growers can deliver green leaf at buying centers. Growers’ information is stored on the PDA and is loaded every morning to ensure that newly registered or transferred growers are included.
Upon delivery of green leaf, the PDA automatically captures the weight into its memory and sends a print-out to the printer. At the end of the day, the weights are downloaded automatically from the PDA to the server at the factory without manual intervention.
The technology consists of a weigh scale, a personal digital assistant (PDA) and portable printer, with rechargeable batteries that can operate for at least 24 hours on continuous weighing without power supply, and server software.
This set-up has ensured that deliveries can carry on through any power cuts. In addition, the PDA has sufficient memory to store data for at least one year.
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