Abundant rainfall, good soils and other ecological factors are behind Rwanda’s quality tea.
But this year, excessive rain between April and June affected the quality of tea, resulting in lower prices on the global market.
The National Agriculture Export Board (Naeb) trading shows that in the 12 months ending June, tea prices dropped to an average of $2.88 per/kg from $3.19 per/kg in the same period last year.
However, heavy rains boosted volumes shielding export earnings.
According to Naeb, Rwanda produced 27,824,246 bags of tea from July 2017- June 2018, compared with 25,128,967 bags exported in July 2016-June 2017.
The tea exports brought in $88 million in the 12 months to June 2018 compared with the $74.5 million during the same period in 2016-2017. Tea which is grown on 27,112 hectares, is a leading export crop, ahead of coffee and pyrethrum.
Kelvin Odoobo, an agronomist in Rwanda, said for smallholder tea farmers, a drop in the global made tea prices translates into reduced farm gate prices for the green tea leaves, as the farm gate price is determined as percentage of the average price at the auction in Mombasa.
Currently, farm gate prices of tea in Rwanda range from Rwf260 ($0.29)-Rwf290 (0.3 per/Kg).
Policy makers in Rwanda have tried to protect the tea sector from market failure risks by diversifying into different export markets and coming up with several products.
One of the leading export markets for Rwanda tea is the UK, which consumed 15 per cent over the past 12 months ending June 2018, amid reports of declining consumption trends in Europe.
Rwanda exporting substantive volumes of tea to Egypt where 6 per cent its tea is exported, followed by Sudan market with a market size of 4 per cent.
The United Arab Emirates consumes four per cent of Rwandan tea, Kazakhstan three per cent, Ireland three per cent Switzerland two per cent and Afghanistan one per cent.