KTDA rejects direct settlement system, warns against political interference in tea sector
KTDA says proposed direct payment system risks farmer incomes and calls for stability and industry-led reforms.
KENYA – The Kenya Tea Development Agency (KTDA) has opposed the proposed Direct Settlement System (DSS), which seeks to allow direct payments to tea farmers and replace the current model where earnings are routed through farmers’ tea factories.
Speaking at the KTDA Factory Directors’ Conference in Nairobi, KTDA Chairman Chege Kirundi said tea farmers are neither prepared nor willing to relinquish control of their earnings to a third-party system.
He cautioned that such an entity may lack a full understanding of farmers’ needs and the operational dynamics of the tea sector, potentially exposing growers to financial risks.
Kirundi also called on politicians to refrain from interfering in the tea industry, warning that political involvement has created confusion in a sector that supports more than 650,000 smallholder farmers across the country.
He said the industry requires stability, predictable policies, and decisions driven by industry stakeholders to remain competitive both locally and internationally.
On tea quality assessment, Kirundi said KTDA would only consider transitioning from the current manual tea tasting methods to scientific testing if buyers formally requested the change.
He noted that any shift must be market-driven to avoid introducing additional costs that would ultimately burden farmers.
KTDA Group Chief Executive Officer Wilson Muthaura urged tea farmers to diversify their farming activities to stabilize household incomes and enhance resilience against market volatility and climate-related shocks.
He reiterated that policy decisions affecting the tea sector should prioritise farmers’ interests and be guided by industry expertise rather than political pressure.
Muthaura also commended tea sales recorded in 2025, describing the year as one of the most challenging periods for the global tea market.
He said that despite falling global prices, rising operational costs, and adverse weather conditions, the smallholder tea model demonstrated strong resilience.
Speaking at the 2025 KTDA Directors’ Conference in Nairobi, Muthaura attributed the sector’s performance to disciplined operations and prudent management. He noted that the key task ahead is to translate operational resilience into sustainable profitability for farmers.
During the year, green leaf production declined by 12.1 per cent due to low rainfall, while made-tea volumes dropped by 11.55 per cent. However, factories sold 319 million kilograms of made tea, representing a 10 per cent increase compared to the previous year.
Muthaura said digital transformation will play a central role in KTDA’s recovery and future growth. He highlighted the rollout of Phase II of the Electronic Weighing System across all 71 factories, noting that the installation of 69 weighbridges has reduced inefficiencies and improved transparency in green leaf collection.
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