Tea factories scaling down

Post was last updated: November 11, 2015

The prolonged dry spell being experienced in the country is threatening the tea sector as production continues to go down resulting in some factories scaling down or suspending production.

Tea is the country’s second largest foreign exchange earner and a leading employer in the private sector.

Tea Association of Malawi (Taml) chief executive officer Clement Thindwa said production reached record low of only 830,158 metric tons for the month of August from an average of 1.5m metric tons per month over the past six years.

He said this is due to the extreme dry and dire weather conditions that necessitated the shutting down of some factories for the first time in a long time as there was hardly any leaf to process.

“This was strategically necessary to avoid some overhead costs,” said Thindwa.

He said with the current situation, performance in terms of earnings has also been depressed.

He said even though production picked up to 1.3 million metric tons in September, the slide to extreme dry and scorch weather conditions in the month of October is expected to produce even more disappointing results.

“Obviously, when there is no leaf, there is no business. This phenomenon has been clearly reflected in the depressed performance of the Limbe Auction

recording the worst through-put ever, necessitating postponement of auctions into the future beyond the normal fortnightly during dry season,” said Thindwa.

“Unless there is some swift change in weather conditions, we may see the worst in the history of tea production in Malawi. Nevertheless and as business people, we remain hopeful and are prepared to take appropriate strategic stance to mitigate the impact of these unfavorable cycles,” he said.

He said from the period July 1 to October 27, 2015, the Limbe auction managed to sell 1.1 million kilogrammes of tea compared to 1.7 million kgs sold within the same period in 2014.

He said the average price during the period was however higher at US$174.67 compared to US$139.36 in 2014 while the Main Grade Special Cultivars and Clonals have recorded average prices of between US$232 and US$ 236 per kg in 2015 compared to US$182 and US$ 183 over similar periods in 2014.

Going forward, Thindwa said the tea industry will have to venture into a re-planting exercise as a key component of its revitalization programme driven by key players in the value chain.

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