Mixed fortunes for tea as demand dip 3%
Despite having a promising start to the tea marketing season fluctuating prices and changing consumption trends threaten farmer’s earnings.
Industry players expressed the concerns on Saturday during the commemoration of the International Women’s Day cerebrations jointly organised by the Tea Association of Malawi (Taml), International Labour Orgnisation and the World University Service of Canada (Wusc) in Thyolo.
Taml chairperson Sangwani Hara said 2019 was promising due to good rains but oversupply of tea in Kenya, is affecting global tea prices.
He said the situation has not spared Malawi because with 95 percent of locally produced tea exported, changing consumption trends from to green, leaf and herbal teas has resulted in an annual three percent decline year-on-year for local tea on the international market.
“A lot of tea hasn’t been sold and some of the contracts that normally close in December for the following year are still open. Last year, we produced 50.5 million killogrammes and so far, this year, production is ahead of last year.
“Malawi produces CTC tea and the biggest export market was the UK, but that segment is decreasing as there is less consumption of black tea, as such, some of tea producers are diversifying to produce more green tea,” he said.
However, Hara was upbeat that Brexit will create an opportunity for Malawi because the UK needs to negotiate separate trade agreements to supply the UK market.
Reserve Bank of Malawi figures indicate that tea production in the fourth quarter of 2018 totaled 9.6 million kilogrammes (kg) compared to 6.5 million kgs produced in the third quarter 2018.
In the review quarter 1.6 million kg of tea was sold through Limbe auction market and averaged $1.54 per kg, lower than $1.71per kg fetched in third quarter 2018 with total realisation from tea sales through the Limbe auction market amounted to $2.4 million in the review period.
Tea is Malawi’s second largest contributor of foreign exchange after tobacco—whose allure is fast diminishing—and contribute about seven percent to the country’s gross domestic product (GDP).
According to available statistics, the tea industry is the second largest formal employer after government, providing jobs to over 60 000 people.
It is calculated that over 1.5 million people rely on the tea industry for livelihoods through knock-on and ripple effect; hence, the industry is a key pillar to the country’s economy.
Meanwhile, Taml says through its Gender Policy, the association has been providing training on issues including sexual discrimination and inequality in the workplace, with the sectors’ wages now are pegged at a minimum K1 510 from K650.
Taml chairperson for the gender and sexual harassment committee Taml Martha Khembo observed that the number of women in managerial positions in the sector remains few with only four women in managerial positions in five estates.
Wusc country director Godfrey Mphande said many of the tea pickers are women, who have been suffering from gender-based violence for a long time but the sector is slowly registering changes through its Gender Policy.
