Normal operations have resumed in two Kenya Tea Development Agency (KTDA) managed factories in the South Rift region, after more than a week of boycott in plucking of green leaf by small scale tea growers.
The strike has been called off following the intervention of Cabinet Secretary for Agriculture Mutahi Kagwe, who brought together KTDA zonal directors from the area to find a solution to the stand off, on April 8,2025, at his Kilimo House offices.
The growers supplying their leaves to Motigo and Olenguruene tea factories in Bomet and Nakuru counties respectively were demanding financial independence from mother factory - Kapkoros Plc in Bomet county.
It comes ahead of a Special General Meeting (SGM) set for May 2, 2025, by the small scale tea growers who are shareholders of Kapkoros, Tirgaga, Motigo and Olenguruene factories - to ratify the separation of accounts as was resolved during an Annual General Meeting (AGM) in 2023 and confirmation of the same in 2024.
For the last seven months, farmers in the region have been been pushing for separation of accounts of Olenguruone and Motigo factories, in what has caused a division between the directors of the zone setting then against the small scale tea growers who elected them to the positions they hold.
The shareholders of Motigo and Olenguruene hold the view, that they have carried the burden of their sister factories on the maintenance of high plucking and processing standards.
The contention is on the quality of tea plucked which has a direct bearing on the performance in the Mombasa Tea Auction and subsequent payment to the farmers.
"What we are demanding for is the separation of the accounts of the factories so that our monthly and annual bonus payment is processed separately," said Ms Ann Kirui a farmer from Merigi Ward.
"When we stand on our own, we have the potential of getting higher bonus as opposed to the current set up where the payment tabulation is on average across the factories where some farmers do not adhere to high standards and in the end, our payment is lower instead of being higher," she added.
The seven directors of Kapkoros Plc – David Korir, Simon Mutai, Benard Koech, Kipkorir Chepkwony, Kipngeno Rono, Dickson Kipyegon Kirui, Benard Kipngeno Rono were summoned to the meeting in Nairobi by Mr Kagwe following the plucking boycott that shone a bad light on the tea industry that has been faced with a myriad of marketing challenges.
It was resolved in the meeting held at the ministry headquarters that the separation of accounts be implemented immediately as was resolved by farmers on December 14, 2023, Annual General Meeting (AGM) at Olenguruone factory.
During an AGM on December 12, 2024 at Kapkoros factory, the separation of accounts was confirmed by the shareholders of the four KTDA factories, with the board of directors meeting on January 9, 2025 reaffirming the decision of the shareholders.
In the business set up, KTDA is the custodian of all assets belonging to the 54 registered factories it manages in the 21 tea growing counties that has 680,000 small scale tea growers supplying their fresh produce for processing.
Principal Secretary for Agriculture Paul Ronoh, KTDA Management Services Managing Director Collins Bett, Tea Board of Kenya (TBK) Chief Executive Officer Willy Mutai, Bomet Senator Hillary Sigei among others attended the meeting at Kilimo House where the resolutions were made.
Mr Kagwe noted that the shareholders of Kapkoros Plc desired and voted for separation of accounts with Motigo and Olenguruone, to allow the latter two to operate independently in financial transactions – especially paying of monthly supplies of green leaf and second (bonus) payment to the growers.
“The coding and issuance of smart cards to farmers in Motigo and Olenguruone be processed as earlier planned,” Mr Kagwe said, noting that the move would enable the factories to have an independent identity from the mother Kapkoros factory.
Mr Kagwe directed that a Special General Meeting (SGM) be held within 21 days, (falling on May 2, 2025), to address the issues raised and agreed upon in the Monday meeting in a “systematic and judicious manner”.
“The directors agree on the modalities of separation, to take due cognizance of all the issues obtaining, and exercise fairness in the discharge of their responsibilities,” Mr Kagwe said after the meeting.
It was also agreed that the construction of a fifth factory at Kamogoso area, whose license has been issued by the Tea Board of Kenya (TBK) in Bomet Central will be supported by Kapkoros Plc (all the four factories existing) in a manner agreed by the farmers, without duress.
“It has been resolved that modernization of the old factories is undertaken by Kapkoros group with assistance from the government so as to enhance the quality of teas processed in the region,” Mr Kagwe said.
The CS stated that the government would not allow a chaotic situation to prevail in the tea industry, which is one of the leading forex earners for the country.
It was the second boycott by the farmers in the region in the last seven months with the one in September 2024 having been called off following an intervention by Principal Secretary for Agriculture Paul Ronoh.
Dr Ronoh said at the time that the 17 KTDA managed satellite factories seeking autonomy from parent companies (factories) would be granted their wish by the government.
A committee to look into the issue and provide the way forward was put in place, but the findings have not been made public so far.
“We are glad that the standoff has been resolved to the benefit of the farmer whose resolution on separation of the accounts of the factories has been upheld by the government. It is a new dawn for the farmers in the region,” Mr Simon Mutai, a director for the Chemaner/Tegat zone, said.
Mr Benard Koech, the KTDA director for Kiromwok/Mugango zone said the impasse would have been resolved earlier had the shareholders resolutions been implemented. He said the shareholders should have the last word on the management of their company.
Mr David Korir, the chairman for Olenguruene zone, called on farmers in the maintain high standards of plucking as set by the industry regulator - The Tea Board of Kenya.
“The rules on two leaves and a bud should be adhered to so as to ensure the entire production and supply chain has high standards that are acceptable in the local and international market,” Mr Korir said.
Farmers from the region commended the government for the intervention, saying it will benefit shareholders of KTDA managed factories.
“We have been wondering all along why the directors have been opposed to the separation of accounts of the factories which in our view would enhance competition in issues related to quality controls,” Mr Daniel Langat, a farmer from Chemaner, Bomet East constituency said.
