East Africa Tea Trade Association (EATTA) has managed the Mombasa tea auction since 1956. PHOTO/UGC.
Reports of the proposed transfer of Mombasa’s weekly tea auction from the East Africa Tea Trade Association (EATTA) to private management if true, is a move that could reshape the future of Kenya’s tea sector and not necessarily for the better.
In a decision said to be spearheaded by the Tea Board of Kenya (TBK), this shift from a non-profit cooperative model to a privately managed auction has set the industry alight with concern.
For over six decades, EATTA has managed the Mombasa auction, which handles 32 percent of the world’s black CTC (Crush, Tear, Curl) tea exports. Its non-profit, member-driven structure has prioritised the sustainability of the sector, ensuring that tea farmers, brokers, and buyers all have a voice.
But now, the prospect of a private entity running the world’s largest tea auction centre is being considered, and the consequences of such a change could be profound.
This decision, which could be finalised in the coming months, must not be taken lightly. The voices of tea stakeholders, particularly smallholder farmers, must be heard, and their concerns must be factored into any final resolution. Without broad-based participation and careful deliberation, this shift risks exacerbating longstanding vulnerabilities within the sector.
There are real fears that the move towards privatisation could erode the transparency and equity that have been cornerstones of EATTA’s governance.
While a private firm may bring operational efficiencies, the profit-driven nature of such an entity could ultimately undermine the principles of fairness and accountability that have governed the Mombasa auction for years. The question is not just one of financial performance, but of safeguarding the interests of the many stakeholders reliant on a stable, transparent market.
Currently, EATTA provides a platform where pricing is based on fair competition, and all participants, from farmers to brokers to buyers; have a vested interest in maintaining its integrity.
However, the introduction of a profit motive risks shifting the focus away from long-term sustainability to short-term profitability. Such a shift could destabilise prices, diminish the influence of brokers, and increase transaction fees, all of which would disproportionately affect the most vulnerable: the smallholder farmers.
Smallholders already face significant challenges in accessing fair markets. They often deal with poor infrastructure, inconsistent quality, and pricing disparities based on region. Under the current model, EATTA helps mitigate some of these inequalities by providing a relatively level playing field.
However, with the auction now potentially being run by a private company, the power dynamics in the sector could tilt in favour of larger commercial producers with the resources to navigate higher operational costs and absorb price fluctuations.
Another concern is the potential for reduced oversight and increased political interference. A private company, by its very nature, could be more susceptible to the whims of political elites, business interests, or government pressure.
Given the importance of the tea auction as a key price-setting mechanism for the global tea market, the risks of undue political manipulation cannot be overstated. Already, tensions exist within the Kenya Tea Development Agency (KTDA), with political factions and regional divisions undermining the cohesion necessary for effective governance.
The risk of further destabilisation in the tea sector is high, and the involvement of private entities could make it more difficult to maintain the independence and impartiality that the industry needs.
If political forces and powerful private interests begin to shape the direction of the Mombasa auction, it is the farmers; the lifeblood of Kenya’s tea sector who will be most at risk.
Willy Mutai, Chief Executive Officer of the Kenya Tea Board (KTB). PHOTO/UGC.
There are already accusations of pricing inequities, with farmers from the western regions of the Rift Valley accusing the KTDA’s leadership of favouritism towards the eastern side. Any shift towards privatisation could entrench these regional disparities, as larger players with access to more resources could dominate the market, leaving smaller farmers further marginalised.
In the face of such uncertainty, it is imperative that all stakeholders, including farmers, brokers, industry analysts, and regional leaders, have a meaningful opportunity to contribute to the decision-making process.
Transparency and broad-based participation are key to ensuring that any shift in the auction’s management is done with full awareness of its potential consequences.
Public consultation is essential not just for the integrity of the process, but also for preserving the legitimacy of Kenya’s tea sector. Given the sector’s importance to the national economy, the voices of those who have built the industry, often under challenging conditions, must not be sidelined.
This is particularly true for smallholder farmers, who constitute a significant portion of the workforce but who often feel disconnected from the decisions that affect their livelihoods.
The Tea Board of Kenya, in its role as regulator, must ensure that the move towards privatisation is not only economically sound but also equitable. Any decision must reflect the diverse needs of the tea community, and care must be taken to avoid policies that would disproportionately favour large producers at the expense of smallholders.
While the auction’s management is one critical issue, it is also part of a wider systemic problem within the tea sector. The continuing regional disparities in pricing, the political tensions surrounding KTDA’s leadership, and the inadequacy of infrastructure in certain tea-growing regions all need to be addressed.
It is tempting to think that privatisation of the auction could be a panacea for the industry’s challenges, but in reality, it is only one piece of a much larger puzzle.
For Kenya’s tea sector to thrive, it needs more than just organisational change, it needs structural reform. This includes addressing the distribution of resources, improving infrastructure, and investing in sustainable farming practices.
As much as a privately run auction might promise operational efficiency, it should not be allowed to overshadow the urgent need for a fairer, more transparent system that works for all players in the tea value chain.
In the coming months, Kenya faces a pivotal moment. The decision to privatise the Mombasa tea auction is not just a matter of economic policy; it is a decision that will shape the future of the country’s tea industry. If done hastily, without adequate consultation and safeguards, this move could lead to greater instability, increased inequities, and potential political manipulation.
On the other hand, if handled with care, transparency, and inclusion, it could serve as a springboard for broader reforms that strengthen the sector for all stakeholders. But this can only happen if the voices of farmers, brokers, and all tea sector stakeholders are heard and respected.
Now is the time for the government to demonstrate leadership—not just in promoting change, but in ensuring that it is change that benefits everyone involved.
As Kenya moves forward, the stakes could not be higher. The future of millions of livelihoods, and billions of dollars in export revenue, hangs in the balance.
