Government sets goals to boost tea industry in Tanzania

Dar es Salaam. The government has outlined its tea sector transformative strategies, which include strengthening domestic auctions and promoting the value addition of locally grown produce by small-scale growers.

The Agriculture minister, Mr Hussein Bashe, explained the strategies during the launch of the Sakare Specialty Tea Company (SSTC) in the Bungu Tanga region.

The facility is set to revolutionise Tanzanian tea cultivation, processing, and marketing, marking a significant stride in agricultural value-addition and industry marketing practices.

Speaking during the event, Mr Bashe said that the government will strategize domestic tea auctions, noting that all large-scale growers would be required to trade at the Dar es Sa-laam Tea Market.

“It won’t matter if the company is registered at the London Stock Exchange. All tea produce should first trade at the Dar es Salaam market. Otherwise, those companies that defy the directive will be required to wind up operations in the country forthwith.  He further noted that, on average, tea traded at the Mombasa Auction fetched an average of $0.7 per kilo and that the lowest grade traded at the Dar es Salaam Market garnered the same price that rose to $0.9 per kilo in the subsequent auction.

Mr Bashe said, despite recording a price of Sh366 per kilo, he was not satisfied and therefore promised to work on challenges affecting tea prices in the country.

“We will also work closely with the Ministry of Finance to establish tax incentives. Tanzania consumes an average of six million tonnes of tea annually, but domestic tea parkers purchase a paltry two million tonnes, suggesting that there was an influx of tea from neighbouring countries,” he says.

The minister pledged to collaborate with the Ministry of Finance to eliminate tea from the list of agricultural produce that is directly imported from East African Community (EAC) member states, promising to protect the produce the same way it does for sugar.

He directed the Korogwe District Commissioner to initiate talks with citizens about relocating to other places after compensation to pave the way for the factory expansion.

He reiterated that by owning 715 hectares, farmers would be able to produce tea for domestic consumption and exports, as well as grow black tea for trading at the Dar es Salaam Tea Market.

“The government has secured funding for the Programme-for-Results (P4R) project, some of which will be used to establish five more value-addition factories for small-scale tea growers,” he said.

“Experts have advised us to source technology from India with expectations that the five factories will commence their operations by June 2024,” he added.

Tea Board of Tanzania (TBT) chairman of the board of directors, Mustafa Umande, said that the sector was facing different challenges, including declining prices and skyrocketing production costs.

“Efforts are underway to increase tea consumption,” he said, commending the government for providing tea seedlings and fertilisers to farmers free of charge.

Kazi Yetu Limited chief executive officer Linus Ndongwe said the launch was a boost towards increasing value-addition, job creation and improving the quality of farmers’ lives, thus increasing competition in the global market.