Kenyan Tea Farmers Face Reduced 2025/2026 Bonuses Amid Supply Decline and Export Levy Impact
Kenyan tea producers face lower bonus payouts for the 2025/2026 financial year due to falling green leaf deliveries, elevated energy costs, and shipping disruptions. Sector leadership has urged the removal of a 0.8 per cent export levy that is impacting international sales.
Kenyan tea farmers are set to receive reduced bonus payments for the 2025/2026 financial year following a decline in green leaf supply and heightened operational challenges, according to reporting by Food Business Africa.
Data indicates that farmers delivered 1.0947 billion kilogrammes of green leaf during the first 11 months of the 2025/2026 financial year, down from 1.1444 billion kilogrammes recorded during the same period in 2024/2025. Directors across Kenya Tea Development Agency (KTDA)-managed factories evaluated green leaf monthly payments, tea sales revenue, electricity bills, management fees, petroleum expenses, and employee salaries prior to finalizing payouts.
According to industry experts, multiple external and operational factors affected financial performance across the sector. Shipping route disruptions resulting from the closure of the Strait of Hormuz drove up petroleum and logistics costs. Experts and industry leadership also highlighted a recently introduced 0.8 per cent export levy as a significant headwind for producers.
KTDA Holding Chairman Enos Njeru stated that the export levy increased the market cost of Kenyan tea, leading several international buyers to reduce or pause purchases. Njeru urged the Kenyan government to repeal the 0.8 per cent levy, cautioning that it directly diminishes farmer earnings and bonus distributions.
Most processing units in the Mount Kenya region registered lower bonus declarations. Rukuriri Tea Factory announced a rate of Kes 50 (US$0.39) per kilogramme, down from Kes 57.50 (US$0.44) paid in the prior period. Ngere declared Kes 48 (US$0.37) per kilogramme, down from Kes 53.10 (US$0.41), while Gathuthi set its rate at Kes 45 (US$0.35) per kilogramme, compared to Kes 56 (US$0.43) previously. Decreases were also reported at Gitugi (Kes 40.50 / US$0.31), Chinga (Kes 36 / US$0.28), Mataara (Kes 33.50 / US$0.26), Iriaini (Kes 33), and Kiru (Kes 31, down from Kes 32).
Bucking the regional trend, Momul Tea Factory posted an increased bonus payout of Kes 40.50 (US$0.31) per kilogramme, up from Kes 32.50 (US$0.25) reported in 2025.
Key facts
- Green leaf supply for the first 11 months of FY 2025/2026 dropped to 1.0947 billion kg from 1.1444 billion kg in FY 2024/2025.
- Bonus declarations decreased across most Mount Kenya region tea factories, including Rukuriri, Ngere, Gathuthi, Gitugi, Chinga, Mataara, Iriaini, and Kiru.
- Momul Tea Factory recorded an increased bonus payout of Kes 40.50 (US$0.31) per kg compared to Kes 32.50 (US$0.25) in 2025.
- Industry experts cited shipping disruptions from the closure of the Strait of Hormuz and higher petroleum costs as key operational challenges.
- KTDA Holding Chairman Enos Njeru urged the government to remove a 0.8 per cent export levy, noting it has driven away some international buyers.
Why it matters
The reduction in bonus payouts and decline in green leaf volume highlight broader cost and trade pressures within one of the world's leading tea-exporting nations. Increased export levies and global logistics disruptions pose potential supply and pricing challenges for international beverage brand owners and bulk tea importers relying on Kenyan supply chains.
- Food Business Africa — 2026-10-01: “Kenya tea farmers to receive lower 2025/2026 bonuses”
This article was prepared by WBI.org from the sources listed above with the assistance of AI and reviewed by a WBI editor before publication. Information is attributed to its original sources.