Kenyan tea farmers set for major leap in industry transformation
Business
By
David Njaaga
| May 07, 2024
Tea farmers affiliated with Gathuthi Tea Factory in Nyeri on a farm. [Kibata Kihu,Standard]
Kenyan tea farmers are poised for a significant leap following a partnership between Lipton Teas and Infusions and Browns Investments.
The deal, agreed upon on May 7, is expected to accelerate the transformation of the tea industry.
The transformation will involve the transfer of tea estate ownership and the global adoption of new quality, social and environmental standards.
Lipton Teas and Infusions have entered into a partnership that will result in the transfer of its tea estates in Kenya, Rwanda, and Tanzania to Browns Investments.
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Consequently, all tea sold by Browns worldwide will adhere to a new set of standards covering quality, social and environmental protections.
The partnership is expected to position Browns Investments as one of the world's leading tea exporters, exporting around 87 million kilograms each year.
Additionally, it will make the company one of the largest suppliers to Lipton Teas and Infusions.
The proceeds of the transaction will be reinvested into the East Africa region, aiming to drive local and industry-wide progress in areas such as skills development and climate change mitigation.
The Kenyan government has supported the companies in identifying opportunities for local communities to benefit from the partnership and future growth of the industry.
In a move to ensure community involvement, shares totalling 15 per cent of the main Kenyan operating company will be offered to the communities of Kericho and Bonnet, where the estates are situated, at a substantial discount.
"Browns is the perfect partner, with the credibility, capabilities, and scale, to work with us to raise standards in the whole tea industry," said Nathalie Roos, CEO of Lipton Teas and Infusions.
Echoing her sentiments, the CEO of Browns Investments noted, "We look forward to working hand-in-hand with Lipton Teas and Infusions and our partners to foster sustainable, responsible, and prosperous tea farming for all."
The partnership comes after President William Ruto met representatives of the two companies at State House in Nairobi where he marketed Kenyan tea as one of the best globally.
The tea industry recorded the highest export earnings ever of Sh180.57 billion last year, an increase from Sh138.09 billion recorded in 2022 and 136.59 billion in 2021.