• Kenya exports far more tea by volume than China and Sri Lanka but earns less revenue.

• Heavy reliance on bulk sales, a narrow product range, and limited market diversity hinder value capture.

• Recent reforms aim to reposition Kenyan tea on the global market.

Since the start of 2025, Kenya has embarked on reforms in its tea sector aimed at boosting its competitiveness on the global market. Despite dominating in export volumes, the country generates lower revenues than its main Asian rivals.

In 2024, Kenya exported 625,558 tons of tea — 67% more than China (374,118 tons) and more than twice the volume of Sri Lanka (243,168 tons), which rank second and third globally.

Yet, East Africa’s largest economy earned $1.4 billion in revenue, nearly matching Sri Lanka’s earnings and slightly below China’s $1.41 billion, according to data from the Trade Map platform.

The paradox lies in the price per ton: Sri Lankan tea trades at an average of $5,793, Chinese tea at $3,794, while Kenyan tea fetches only $2,252. This significant undervaluation of Kenyan tea compared to its Asian competitors stems from three major factors.

A Business Model Still Too Focused on Bulk Sales

Kenya’s marketing approach remains the first barrier to increasing tea’s value. Approximately 99% of Kenyan tea exports are shipped in bulk, without packaging or branding. According to the Kenya Export Promotion and Branding Agency (KEPROBA), this bulk tea is often blended with other teas, repackaged abroad, and sold without indication of origin, causing Kenyan tea to lose its identity.

By contrast, Sri Lanka exports nearly 48% of its tea in packaged form (under 3 kg), allowing it to maximize the unit value per kilogram. Kenya’s reliance on bulk sales means it misses out on this added value.

This issue is critical since most value in the tea supply chain is captured during processing and grading. The International Institute for Sustainable Development (IISD) noted in a 2024 report that "most tea companies in producing countries sell bulk processed tea, which is ready for consumption but not labelled, packed, or branded and receives a price that is one sixth of its potential value (Khoi et al., 2015)."

A Narrow Product Range Dominated by CTC Black Tea

Unlike its competitors, Kenya’s exports lack diversification and are overwhelmingly dominated by CTC (“Cut-Tear-Curl”) black tea, which accounts for 99% of production and exports. While popular for its strong flavor and convenience in tea bags, CTC tea is often seen as standardized and low-end.

Higher-value markets seek specialty teas such as green, white, oolong, or purple teas, prized for their health benefits and commanding higher prices. KEPROBA reports that Kenyan production of oolong and green teas remains marginal and is mostly made on demand.

Trade Map data shows that 88% of China’s tea exports are green tea. Kenya, with barely 1% specialty teas in its export mix, misses out on the premium segment’s added value.

Dependence on a Limited Number of Markets

Kenyan tea reaches over 70 destinations, but about 85% of exports are absorbed by just ten countries, including Pakistan (the largest buyer with 36% of volumes), Egypt, the UK, UAE, Sudan, Russia, Yemen, Afghanistan, Kazakhstan, and Saudi Arabia.

KEPROBA notes that these markets traditionally focus on bulk tea and offer limited opportunities for premium products, while also being volatile due to economic and geopolitical instability.

The agency further explains that in other international markets, Kenya’s market share remains low because competitors like Sri Lanka, India, and China dominate these regions by prioritizing orthodox and green teas — segments where Kenya’s presence is still only marginal.

What is the Government Doing?

To address these structural and commercial challenges, KEPROBA recommends a strategic expansion plan to promote Kenyan tea, diversify markets, and increase global market share. The government appears to be heeding this advice with reforms launched since early 2025.

In May, the Ministry of Agriculture announced planned trade missions to key countries and regions to strengthen Kenya’s international presence and open new markets.

Additionally, on May 6, the government introduced a tax exemption on tea packaging materials, aiming to reduce production costs — a major barrier to processing, packaging, and value creation in the sector.

Stéphanas Assocle