Rwandan Tea leads Mombasa auction as Kenya faces rising unsold volumes 

KENYA – Rwandan tea has continued to command the highest prices at the Mombasa Tea Auction, reinforcing its dominance in regional trade as Kenyan tea struggles with rising unsold volumes linked to new export levies. 

Industry players attribute Rwanda’s strong performance to consistent quality, an efficient supply chain, and sustained demand from international buyers seeking premium teas despite global market uncertainty. 

Latest auction data shows Rwandan tea averaged US$2.81 per kilogramme, significantly higher than Kenyan tea at US$2.20 and Ugandan tea at US$1.26 per kilogramme, highlighting a widening price gap between regional producers. 

Kenyan tea’s competitiveness has weakened following the introduction of an export levy in May, which traders say has increased costs across the value chain. The levy has particularly affected teas marketed through the Kenya Tea Development Agency (KTDA), especially from the West and East Rift regions. 

While transit tea remains exempt, Kenya has recorded some of the highest unsold volumes at the auction this year as buyers increasingly turn to lower-priced alternatives from competing origins. 

Tea Buyers Association chairman Peter Kimanga said the levy is already affecting earnings across the sector. “Since May 1, KTDA, which handles the largest percentage of tea from Kenya, has been paying substantial amounts in export levies every week,” he said.  

“If the government does not suspend the levy, those costs will inevitably be transferred to farmers through lower returns and reduced bonus payments.” 

Kimanga added that exporters are paying about Ksh80,000 ($618) per container before shipment, further increasing pressure on margins. 

Pakistan, one of Kenya’s largest tea markets, has also raised concerns over the policy. “Pakistan has protested the levy because it only affects Kenyan tea,” Kimanga said. “Buyers will naturally compare prices and opt for tea from other countries.” 

The latest Mombasa Tea Auction weekly report shows Sale 22 recorded 27 percent unsold tea, with only 9.19 million kilogrammes sold out of 12.52 million offered. This marks the highest unsold level so far this year. 

The trend has been deteriorating steadily, with Sale 20 recording 22 percent unsold tea and Sale 21 rising to 23 percent. 

KTDA-managed factories, which account for more than 60 percent of auction volumes, have been the most affected. 

Agriculture Cabinet Secretary Mutahi Kagwe defended the levy, saying it is part of reforms aimed at improving farmer earnings. He said the government targets raising green leaf prices to Ksh100 (US$0.77) per kilo by 2027 and doubling smallholder incomes. 

Exporters, however, say the requirement to pay levies upfront has increased financial strain alongside freight, insurance, and financing costs, further reducing competitiveness in key markets. 

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