NAIROBI, Kenya, Jul 22 – Small scale tea farmers affiliated to the Kenya Tea Development Agency (KTDA) will pay Sh1825 per 50kg bag of fertilizer on average, the tea agency said in a statement on Wednesday.
In the statement, KTDA said that the price was arrived at after factoring in freight, port charges, financing costs and local transport as well as prevailing exchange rates.
“This amount is much lower than was anticipated at the time of award of tender,” the statement said.
The furthest factories from the port of Mombasa will part with Sh1880 per 50kg bag while the nearest will pay Sh1764 per 50kg bag.
“The price differential is attributable to the cost of transport from the port of Mombasa to the respective factories,” the statement indicated.
Majority of the more than 500,000 farmers have already received their fertilizer orders ahead of the short rains which is expected in August.
Last week while attending a Farmers’ Field Day at KTDA’s Kapsara Tea Factory, Agriculture Minister, William Ruto, commended KTDA for efficiency and effectiveness in the procurement and distribution of fertilizer to small scale tea farmers. The Minister said he was satisfied with the final price of the fertilizer.
Farmers pay for part of the fertilizer cost through deductions spread over 12 months from their monthly payments for green leaf deliveries, which in industry parlance, is referred to as the Initial Payment. The balance of the fertilizer debt is deducted in a lump sum from the Second Payment (referred to as the Bonus) around October.
The 57,000 metric tons of NPK 26:5:5 chemically compounded fertilizer was procured through an international tender early this year after prices dropped from a high of $847 per metric tons in April 2008 to $350 per metric tons in January this year.
The first batch, amounting to 28,500 metric tons, arrived in the country on May 1 while the second batch of the same amount docked at the Port of Mombasa on June 1.
KTDA was forced to suspend the annual fertilizer procurement in 2008 to protect farmers’ incomes from being wiped out by high production costs.
“The prices had nearly tripled, rising from Sh1, 296 per 50 kg bag in 2007 to about Sh3400 per 50 kg bag in 2008. The rise was occasioned by a sharp rise in global oil prices and the consequent increase in freight charges,” KTDA said.
Some 90 per cent of the farmers who have less than an acre of land under tea, would have seen their incomes diminish had the fertilizer been procured at such high prices.
KTDA procured the fertilizer on behalf of its small scale tea farmers without any subsidy whatsoever. This means unlike other crops such as maize, tea farmers bear the whole cost of buying and distributing the fertilizer.