Tea Prices Fall as Strike Action Halts Distribution

By Phillip Hogan

February 19th, 2010
Posted in Africa, Intl Tea Trade, Tea in the News

A strike over pay, last week, saw African tea prices fall as shipments were disrupted by workers picketing warehouses.

Workers from tea warehouses in Mombasa staged a strike which lasted for four days, effectively shutting down the tea distribution network in Mombasa – the port city which plays host to one of the world’s largest auctions of tea.

The affects of the strike are believed to hit hardest later next week as the Kenyan tea trade braces itself as delays in delivery are expected to have a negative impact on auction prices.

The strike was initiated after workers in some tea warehouses were paid below the minimum recommended wage.
George Nesbitt, the director of Tea Warehouses Ltd, told reporters that ‘companies were affected because there was picketing even at the places where they were paying the agreed rate.’

The situation has now been resolved as management increased the disgruntled workers pay in warehouses that were paying below minimum salary recommendations. After three hours of negotiations representatives of the Kenya Shipping Clearing and Warehouses Workers Union were able to reach an agreement with warehouse owners – who agreed to increase minimum payment from Sh11.25 for a 90kg bag of tea to Sh13.70, also increasing the rate from Sh6.25 for a 50kg bag to Sh7.50.

Tea prices fell this week at the Mombasa auctions, with 21% of tea on offer remaining unsold by end of bidding. Of the 24 tea grades presented at the auction, prices were seen to drop on 20 different grades.

The labour disruptions around Mombasa warehouses, caused by striking workers, is believed to be the cause after more than 2,000 loaders refused to work until a deal was reached over pay.

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Contact Phillip Hogan at phil@allabouttea.co.uk

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