Uganda tea prices rebound 21 percent at Mombasa auction

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Uganda’s tea sector is showing renewed signs of recovery, with auction prices rebounding by 21 percent and absorption rates strengthening.

Sector players say this is offering cautious optimism to growers and processors after years of volatility. Data from the Mombasa tea auction indicates that Ugandan tea prices have been steadily improving, even as stakeholders push for structural reforms and government intervention to secure long-term stability.

Victoria Ashabahebwa, the chairperson of the Uganda Tea Association (UTA), said the sector is beginning to recover on the back of coordinated efforts by industry players and government support.

“Uganda teas experienced the best absorption at the Mombasa Auction in 2025, hitting 92 percent, which is a 3 percent improvement from the 89 percent recorded in 2024,” Ashabahebwa said.

According to her, Uganda tea's absorption has remained steady at above 90 percent, and prices are also on a recovery path, though at a slow pace.

She noted that average prices rose by 17 US cents (about sh625) per kilogram, from $0.85 (about sh3,125) in 2024 to $1.02 (about sh3,876) in 2025, a 21 percent increase that outpaced gains in competing markets.

“The main grades category had a cumulative average price of $1.09 (about sh4,142), while the secondary portion had a cumulative average price of $0.91 (about sh3,458). In 2024, the main grade portion averaged $0.94 (about sh3,455), and the secondary portion averaged $0.69 (about sh2,536),” she explained.

The recent gains have been reinforced by strong performances in early 2026 auction sales, with some Ugandan tea brands beginning to rival traditionally dominant Kenyan producers.

“We saw in the just concluded Sale 13 of 2026 some of the top-performing Uganda tea factories catching up with some of the Kenya plantation factories,” Ashabahebwa said.

She added, “Brands like Kabale, Kisoro, Kigezi, Kyamhunga, Bwindi, Tea Maria and Global Village had prices hitting above $1.48 (about sh5,624), which was previously the low-end price for some Kenyan plantation marks. This is a very good sign of price recovery for Uganda teas.”

She attributed the progress to collective action following a multi-stakeholder meeting held on May 3, 2024, under the East African Tea Trade Association (EATTA), where industry players agreed on reforms to improve competitiveness.

“Recommendations were made and tasks assigned to all stakeholders, who committed to play their part. We are proud that about 90 percent of those resolutions have been achieved,” she said.

Ashabahebwa also praised the government’s role in revitalising the sector, noting that the Minister of State for Agriculture Fred Bwino Kyakulaga had fulfilled key commitments, including facilitating a high-level meeting with President Yoweri Museveni in 2025.

Government’s intervention plan

Speaking at a tea producers’ retreat in Fort Portal, Kyakulaga acknowledged the financial strain within the sector and outlined steps being taken to address long-standing obligations.

“When the former NAADS was rationalised into the Ministry of Agriculture, we inherited obligations to our nursery bed operators amounting to sh70.3 billion. I am proud to report that the Ministry has already paid sh50 billion, leaving a balance of sh20.3 billion,” Kyakulaga said.

He added that the government is working with the Ministry of Finance, Planning and Economic Development to clear the outstanding balance and restore confidence among stakeholders.

“We have engaged the Ministry of Finance, Planning and Economic Development to release this balance, because every operator deserves closure and recognition for their contribution,” he said.

However, Kyakulaga acknowledged additional claims from nursery operators, including sh25.2 billion from those who supplied seedlings without formal contracts and sh141 billion in compensation claims for losses.

“These claims must be verified to ensure that every operator is treated fairly and every shilling is accounted for,” he said.

The minister also pointed to a major government commitment made in August 2025, when the President pledged sh310 billion to rejuvenate the tea sector.

“Sh152 billion was allocated for tea factories, sh46 billion for fertilisers, and sh112 billion for tea seedlings suppliers. This is not just about settling debts, it is about restoring confidence, strengthening partnerships, and unlocking the full potential of Uganda’s tea industry,” Kyakulaga said.

Industry stakeholders say such interventions, combined with market reforms, could accelerate the price recovery. George Omuga of the East African Tea Trade Association recently emphasised the need for policy adjustments to sustain the gains in the sector.

“Bilateral agreements with the government of Kenya, when done, will ease non-tariff barriers affecting the tea sector. Market access programmes should be established, and we recommend no VAT on local sales to encourage domestic consumption,” Omuga said.

He added that boosting local demand could reduce volumes at the auction and, in turn, support higher prices.

“This reduces the quantities at the auction and may in turn, drive auction prices up. Industry regulation is also a priority for us to address issues of quality and standards,” he said.