Tea factory boards in Region Five, which covers Kericho and Bomet counties, have agreed to maintain the monthly green leaf payment at Sh23 per kilogram.
The decision was made during a regional meeting held at Kapkatet Tea Factory, attended by factory chairpersons and board members operating under the Kenya Tea Development Agency (KTDA).
In a joint statement, the boards said the 2024/2025 financial year has been difficult due to weak tea sales and low prices at the Mombasa Tea Auction. This has reduced factory income and affected cash flow.
“The current financial position of the factories does not allow an increase in the monthly green leaf payment at this time,” the boards said.
They explained that low global demand and unstable prices at the auction have continued to hurt earnings. In addition, the amount of green leaf delivered by farmers has dropped, further straining factory finances and making it harder to meet operating costs and farmer payments.
Factory leaders urged farmers to continue delivering tea, saying higher volumes would help factories benefit if market conditions improve in the coming months.
“Steady supply is important so that factories can earn more when prices recover,” the boards said.
While the payment rate will remain at Sh23 for now, the boards said the issue will be reviewed again once factory performance improves.
The factory leadership also committed to cutting costs, improving efficiency and strengthening market strategies to boost earnings. Farmers were encouraged to maintain high plucking standards, noting that leaf quality plays a major role in determining auction prices.
“Better quality tea leads to better prices and higher payments to farmers,” they said.
The decision in Region Five reflects a similar trend in other KTDA-managed regions, where factories have taken a cautious approach due to ongoing market challenges.
In recent months, tea factories in parts of Nyanza, Central Kenya and the Rift Valley have either maintained or slightly adjusted payments after reviews showed that low international prices, reduced buyer activity and rising costs were affecting profits.
Industry analysts say the situation has been caused by global oversupply, weak demand in key export markets, currency changes and higher production costs, all of which continue to put pressure on tea factory earnings.
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