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OPINION

By Alex Amanya

The world will be celebrating the international tea day this week. This day is observed annually on May 21 and has been celebrated since 2019 after a resolution adopted by the United Nations. The goal of the day is to promote and foster collective actions to implement activities in favor of the sustainable production and consumption of tea and raise awareness of its importance in fighting hunger and poverty.

Today if you asked the tea stakeholders, especially farmers in Uganda whether the day is worth celebrating, most probably you will get a negative answer. This is because prices for tea at the Mombasa auction are their all-time low with the Uganda average price being less than 80 cents of a dollar for a very long time. Factories and farmers are not breaking even, companies have used up their reserves and others have failed to service their loans. This has led to uprooting of generational tea farms by farmers, closing down of some factories and worse some factories being put up for sale by banks and creditors.

Many Ugandan stakeholders have blamed one another for the cause of the current situation with the quality of Uganda's tea being at the centre. This in comparison with other neighboring countries such as Rwanda, Burundi and Kenya who have better prices than Uganda. Factories have blamed farmers for poor quality and farmers to farmers vice versa.

At some point farmers and a few factory owners blamed the government for failure to regulate the sector through a policy since self-regulation between factories and farmers has evidently failed. Some sections of the stakeholders especially from the factory owners also believe public regulation is not the solution but have not presented a compelling one. I hope all in the end all stakeholders can find an amicable solution on the way to proceed to improve Uganda’s tea quality.

However, the question still stands whether Uganda's tea quality is the only problem and once addressed all problems will be solved? Certainly not! The current problem of the tea sector, especially the conventional black (CTC) type is not only specific for Uganda, but to most of the tea growing regions including East and Southern Africa and Some parts of Asia (India and Nepal).

Although Uganda and other poor-quality tea producing countries such as Tanzania and Malawi have been hit the hardest. Other better-quality CTC producing countries such as Kenya and Rwanda have not been hit so had on the prices but certainly the profitability of those industries has been affected greatly due to their high cost of production mainly coming from the costs related to producing quality tea for example the cost of harvesting the tea in Kenya is 3 times more compared to the Uganda because their pluckers are paid more compared to Uganda.

The fact is that there has been an exponential increase in the global production of the conventional black CTC teas while the global demand has stagnated and in some areas such as the United Kingdom even gone down with substitute products such as coffee taking up the space during the last two decades. Efforts need to be made to create global demand for tea to reverse the challenges.

However, all is not lost and grim, some ray of hope is starting to emerge especially in North America where the demand for tea is starting to increase such as the USA where sales for tea were 1 billion dollars in 2021 and 14 billion in 2023(Tea Association of USA). As written by William Dietz, an international tea expert in his article entitled “Is the tea market saturated?” He contends a few areas that must be done to explore these emerging markets such as understanding the diverse preferences of tea drinkers, use of e-commerce and use content creation platforms to reach wider audiences and niche markets.

To take advantage of these emerging markets, the sector players need to adopt new business models to diversify from the current conventional auction sales. The industry needs to take innovative approaches to reach out to these new market requirements the way the coffee sector perfectly does it. The sector needs to start looking at special teas encompassing origin preferences, flavor blends, impact stories and wellness aspects of the product compared to competitor beverages such as coffee.

However, to take up these new emerging opportunities, the industry needs to be willing to be innovative and change. The tea sector is so orthodox in the way it's marketed, especially around bulk auctions. Nothing much has changed in the way it's marketed since the global commercialization of tea by the British yet the demographics of the consumers has greatly changed. For Uganda, the quality issue needs to be addressed because all business models put quality at the center.

The government needs to support the sector through enforcing a greenleaf quality standard but also support the sector to explore these new emerging markets. With this, the value of Uganda's teas at auctions will be optimized and also new market opportunities created. Other countries such as Kenya are already seeing this and ahead with their president recently giving assurances to its sector to explore these new opportunities and quality while creating an international brand for Kenya teas.

The writer is a senior programme manager, Solidaridad East and Central Africa