The East Africa Tea Traders Association (EATTA) is set to appoint an officer to lead in introducing an electronic trading platform for the weekly auction in Mombasa to increase transparency in dealings. Applications for the position closed Wednesday, paving the way for interviews and appointment that will mark a milestone in the way tea is traded. The association expects to begin automating the auction this year and complete the shift to the new platform by 2017 at an estimated cost of Sh133 million ($1.3 million) financed by Trade Mark East Africa. During a visit to the auction last month, President Uhuru Kenyatta urged members to speed up automation to boost transparency.

“Automating your system will go a long way to dispel some of the perceptions that this is a house of collusion. People believe that you just come here to showcase, but the real deals are done at night,” he said. The auction in Mombasa handles tea from nine African nations, including Burundi, Rwanda, Uganda, Malawi and Mozambique. Ethiopia is due to join in March. Kenya expects to earn Sh115-120 billion from its tea exports this year, depending on the exchange rate, after a 23 per cent rise to Sh125.25 billion year, the agriculture industry regulator said on Wednesday. The Agricultural, Fisheries and Food Authority (AFFA) said total output fell 10 per cent to 399.21 million kilos in 2015 but earnings rose due to a 38 per cent jump in the average auction price of tea to $2.98 (Sh303.96) per kg.

Earnings were also boosted by a weak shilling, which in late 2015 hit lows last seen in October 2011. Alfred Busolo, AFFA acting director general, told a media briefing in Nairobi on Wednesday that production was likely to be maintained at last year’s levels, thanks to the good amount of rains brought about by the El Niño weather phenomenon. However, other producers might also benefit from the continuing rain and as a result auction prices could eventually come under pressure, he added. “If it goes on like this production will be maintained so we will not have a dip in production,” he said.

Source: Business Daily

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