Tooro tea farmers frustrated as prices remain low

Uganda's tea industry saw a slight price surge at the recent Mombasa Tea Auction, with the national average climbing to $0.98 (Shs3,605.45) per kilogramme, up from $0.87 (Shs3,200) in August.

The recent auctions at the Mombasa Tea Auction, closing on September 17, revealed a notable increase in prices for Ugandan tea, with the average price reaching $0.98 per kilogramme according to Mombasa Tea Auction Average Hammer Prices, Auction No. 2024/38, which included the performance of 37 Ugandan tea factory marks.

However, for tea processing factories in Tooro Sub-region, this increase has done little to push them past the crucial $1 mark per kilogramme, compared to other sub-regions of Ankole and Kigezi that have consistently sold their processed tea above a dollar.

Mr Onesimus Matsiko, the chairperson of the Uganda Tea Outgrowers Association (UTOA), at the weekend said the average price of $0.98 per kilogramme represents an increase of about 11 cents compared to a similar period in the third week of August when prices stood at $0.87 per kilogramme and 12 cents higher than Uganda’s average price of $0.86 (Shs3,163.97) per kilogramme one year ago.

This increase implies that at $0.98 per kilogramme, the price of processed tea in Ugandan currency rose to Shs3,631.79 per kilogramme, compared to Shs3,224.14 in August and Shs3,187.08 a year ago.

As a result, the tea processing factories from the Tooro sub-region, despite their bigger contribution of 40 percent of Uganda’s tea, sold their tea below the dollar mark.

Out of the nine tea factories in Tooro that sold processed tea, according to Mombasa Tea Auction Average Hammer Prices, the 37 Ugandan tea factories averaged $0.98 per kilogramme only three tea factories managed to sell above the dollar: Nyambya at $1.19 (Shs4,378.05) per kilogramme, Buzirasagama at $1.01 (Shs3,715.82) , and Kahuna at $1.00 (Shs3,679.03).

The remaining six factories sold below the dollar per kilogramme: Munobwa at $0.98 (Shs3,605.45), Toro at $0.81 (Shs2,980.01), Kijura at $0.80 (Shs2,943.22), Mwenge at $0.72 (Shs2,648.9), Kiamara at $0.69, (Shs2,538.53) and Kyenjojo at $0.63 (Shs2,317.79).

Even the primary grades of tea (BP1, PF1, PD, and D1) continue to sell below the dollar mark, reflecting the low performance.

In contrast, factories from other sub-regions such as Ankole and Kigezi are performing better, consistently selling their processed tea above the dollar. Bwindi sold at $1.26 (Shs4,635.58) per kilogramme, Kisoro at $1.22 (Shs4,488.42), Kabale at $1.20 (Shs4,414.84), Kyamuhunga at $1.19 (Shs4,378.05), Kayonza at $1.11 (Shs4,083.72), and Kigezi Highland at $1.22 (Shs4,488.42).

Mr Matsiko explained that the poor performance in the Tooro Sub-region is primarily due to the low quality of tea leaves purchased from out-growers.

In comparison, factories in other sub-regions source higher-quality green tea leaves. Tooro has also been facing a labour shortage, especially in large-scale plantations, further affecting production.

“While the main tea industry depression has been driven by global oversupply, Uganda's tea competitiveness can be improved by government interventions for quality improvement. This is primarily on fertiliser subsidy and basic government regulation for product quality control. All the interventions approved by the Cabinet in February this year have not been implemented yet,” he said.

Mr Matsiko added: “The green leaf farm gate prices, which have remained low, won’t change with such slight improvements until tea prices hold for some time during the main season, and this is also subject to the green leaf supply relative to processing capacities.”

He said farmers should not celebrate too soon because Uganda has registered a significant drop in processed tea volumes at auction 38 of 2024, with 598 metric tonnes sold compared to 922 metric tonnes in 2023.

“For Uganda, it is evident that most tea gardens have not received fertilisers for a long time. Several gardens have been abandoned, while a few have been cut down or permanently uprooted,” Mr Matsiko added.

He explained further that the total volume of tea sold at this auction was 5.5 million kilogrammes, down from 7.8 million kilogrammes sold at the same auction last year. Additionally, many factories are increasingly bypassing the Mombasa Tea Auction by opting for direct exports.

Tea Farmers

Tea farmers in Kabarole and Kyenjojo districts are increasingly expressing frustration over the continued decline of green tea leaves prices now between Shs150 to Shs200, which has forced many to abandon their once-thriving gardens as several farmers are now uprooting their tea plants or leaving them to become overgrown with weeds.

“We used to rely on tea as our main source of income, but the prices have dropped so much that it's no longer worth it. I’m considering replacing the tea with bananas, which seem to fetch a better price,” said Mr Samuel Muhumuza from Kyenjojo.

Ms Grace Kyomuhendo, who has been growing tea in Kabarole for over a decade, said: “I have started planting beans and maize between the tea bushes to make ends meet.” 

Mr Robert Amanya, another farmer in Kabarole, said the fluctuation of tea prices is painful for farmers.

“I inherited this tea plantation from my father, and it provided for my family for years. Now, with the low prices, I have been forced to abandon most of them. The weeds have taken over, and I am not sure if I will ever be able to restore it,” he said.

Ms Florence Tumushabe from Kyenjojo said: “We used to be proud of our tea, but now we can’t afford to maintain it. Many of us have started inter-cropping with other crops like cassava and coffee, to survive, if the prices don’t improve soon, there will be no more tea left in this area.”