Tea farmers in Bushenyi decry low prices, call for tax holiday

BUSHENYI, October 2, 2023 – Tea farmers in Bushenyi district have petitioned the government to grant them a tax holiday to recover from the losses arising out of low prices.

In a meeting held at Kyamuhunga Catholic Parish Hall, the tea farmers under their Umbrella, Uganda Tea Out-growers Association [UTOA] argued that taxes should be stopped in the tea value chain until the prices stabilise.

According to Sula Nuwe, a tea farmer and a councillor representing Mashonga parish, Kyamuhunga Sub-county, in Bushenyi district, a kilogramme of unprocessed tea now is being sold at a farm gate price of between Shs 200, from Shs 500 that was being offered.

Due to the declining prices, Shallon Tumusiime, another tea farmer in Bushenyi district said that she no longer has any guts to work on her 10-acre plantation. “The situation is terrible for us here. We no longer even think of getting out of bed to pluck tea leaves, we are only waiting for the government’s intervention,” Tumusiime said.

Savio Tumuramye who has also abandoned his 8-acre tea plantation in Kyamuhunga due to the low prices is considering uprooting the tea trees and replacing them with food crops.

“I cannot waste my little resources anymore on fertiliser, pesticides, and labour and at the end of the day, I sell a kilogramme of tea at Shs 100,” Tumuramye said.

Initially, Tumuramye said, his tea plantation would earn him around Shs 2.4 million per harvest. However, with the current drop in prices, he is earning less. “You would pluck 4,000 Kilogrammes of tea at the price of Shs 600 per kilo t but now you harvest 1,000kgs and sell at Shs 100. This cannot even pay for the labour,” he said.

Despite the low prices offered, Tumuramye said Igara Tea Factory in the area has failed to pay farmers for the last three months.

“We demand Igara Tea Factory supply them with tea in the months of August, September, and October. They haven’t paid us but the factory officials also told us that they are suffering losses,” he said.

Olden Taremwa, an established tea farmer in Bushenyi district blamed the low prices on the poor quality of Uganda’s tea, urging the farmers to practice good agronomic practices.

“Uganda’s tea is given a low price at the Mombasa Tea Auction, so let the farmers ensure good agronomic practices to keep quality standards of the green tea leaves,” Taremwa said.

Onesmus Matsiko, the board chairperson of UTOA confirmed that the crisis tea farmers are facing has never happened for the last 30 years in Uganda.

Onesmus Matsiko, chairman of Uganda Tea Out-growers Association (Photo by Joshua Nahamya).

He said that in Kyenjojo district farmers have started uprooting the tea tree to invest in crops that fetch good prices.

“The majority of farmers in the district derive their livelihood from tea growing but if this crisis persists, no tea farmer will be able to take a child to school,” Matsiko added.

He asked the government to provide tea factories and associations with a revolving fund to buy farmers’ tea.

“The government should provide factories with a revolving fund as an emergency to address the price crisis. And if it is not done, we are likely to see some tea factories’ properties being attached by banks,” Matsiko explained.

According to Matsiko, the major tea consuming country [Pakistan] has an economic crisis.  “Mombasa sells about 9 million kilogrammes of tea in a week and Uganda only contributes about 1 mln kilogrammes.”

“Actually, last week Uganda contributed just 700,000 kilogrammes, meaning that 30-33 percent of the country’s remained unsold,” Matsiko said.

98 percent of the tea produced in Uganda is exported. However, there has been a drop in prices at the Mombasa Tea Auction, from an average of US$ 1.9 [Shs 7,000] to an average of US$ 0.65 cents [2000], which has made some of the local factories reduce the green leaf price from Shs 500 per kilo to Shs 200 per kilogramme.

The Mombasa Tea Auction is the world’s largest black CTC tea auction for export.  Each week, teas worth over US$ 20 million are traded from Kenya, Uganda, Tanzania, Rwanda, Burundi, the Democratic Republic of Congo, Malawi, Madagascar, Mozambique and Ethiopia.

The Tea industry in Bushenyi district alone has been employing more than 10,000 people directly while 100,000 others were being employed indirectly.

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