Kenya
Fears that poitical uncertainty in Egypt may soon start to negatively affect the price paid at auction for tea in Mombasa if it continues have tempered jubilation at recent record export earnings, according to a report dated February 7.
Egypt is a significant buyer of Kenyan tea, particularly for specially blended dusts, accounting for around 21% of its total export sales. But brokers representing Egyptian buyers have been noticeably absent at recent auctions, fanning concerns that if the popular uprising lasts much longer, warehouse space will become an issue and traders and sellers will be hurt.
“Most of the tea was purchased in December when the prices were high, now they are low. What will happen is a lot of defaults. So they (Egyptian buyers) may buy low to average the prices,’ according to Peter Kimanga, a tea manager at Global Tea and Commodities Kenya Ltd, quoted by Reuters. “The dust grade is suitable for tea bags so traders are likely to move away from the good grades which are more expensive,” Kimanga said. “Kenya may lose as much as 30% in auctions over the next month should the Egyptian situation remain unresolved.”