Kenya in spat with Iran over Sh4bn tea exports
Kenya has protested against a price cap that the Iranian government has imposed on tea exports to the country, putting the Sh4 billion market at the centre of a diplomatic tiff with Tehran.
Iran has instructed Kenya to set the maximum price per kilo of tea that it sells to the Asian country at $3 (about Sh300), with anything above the amount attracting a punitive tax. The move has seen Kenya’s
Ministry of Foreign Affairs write to the envoy in Tehran, asking him to seek clarification and lobby for easing of the new requirement.
“Kenya is seeking clarification as well as relaxation of the new rule that has been put in place by the Iranian government,” said the Director General of Agriculture and Food Authority, Anthony Muriithi, in an interview.
Kenya’s tea gets to Iran at about Sh400 per kilo, making it pricier than other teas sold in the country, mainly from India and Sri-Lanka.
The quality of Kenyan tea is however superior compared to the others, which makes it highly sought after by the Iranians.
“Some of the factors that might make it difficult to achieve the Sh300 per kilo include the high quality of Kenyan tea, cost of production and the shipping costs,” he said.
Nairobi has been courting Iran to become one of the major consumers of Kenya’s tea, and has held sales exhibitions in Tehran aimed at wooing buyers.
This is the second time in two years that Kenya has been locked in a dispute with Iran over the commodity. In 2017, a tussle about the recommended minimum moisture content in the beverage saw a sharp decline in the volumes exported to Tehran. Iran has a lower limit of three per cent moisture content with an upper cap of eight per cent, but Kenya’s tea normally falls below three. Kenya uses ISO 3720, a global standard that does not stipulate a minimum moisture content.
“We have to do all that we can to ensure that the new rule is reversed to protect our sales to that country,” said Eatta managing director Edward Mudibo in an interview.
In January last year Kenya, nearly lost the critical Pakistani market as the country raised concerns over possible contamination of aflatoxin in the commodity, requiring the beverage to undergo rigorous tests that created a backlog on consignments destined to Islamabad.