The world’s largest black tea auction held in Mombasa, Kenya is set to undergo automation following the signing of a $1.5 million financing agreement between the East Africa Tea Trade Association (EATTA) and TradeMark East Africa (TMEA) which will provide the funding.
The Mombasa Tea Auction handles about 75 per cent of tea exported through the Mombasa port covering shipments from EATTA member countries of Burundi, Kenya, Rwanda, Uganda, the Democratic Republic of Congo (DRC), Tanzania, Ethiopia, Malawi, Madagascar and Mozambique.
Last year, the auction handled over 350 million kilograms of tea, providing a platform for more than one million tea farmers in Africa to sell their tea before shipping it across the world.
“This portal will simplify the tea auction with the added benefit of increasing transparency and thus gaining stakeholder confidence in the auction,” said EATTA Chairperson Nicholas Munyi.
The proposed integrated Tea Trading System (iTTS) will encompass the entire tea export processes which include pre-auction, auction, post-auction and a Business-to-Business marketing network.
It is expected to reduce the tea trading cycle from the current 45 to 60 days to less than one month ensuring that farmers receive timely payments, negating the need for them to take loans to finance their operations.
TMEA CEO Frank Matsaert said that automation of key trade systems reduces barriers to trade and is one of the ways TMEA is using to boost intra-African and East Africa’s trade with the world.
“I am excited to see that tea, a major forex earner for the region, will reach the breakfast tables across the world in an efficient and cost effective way and that the farmers working hard on their farms will regain confidence in the trading process as a result of the transparency and accountability the system will give,” he added.
The streamlined portal will reduce complex and bureaucratic trading processes for tea brokers; and give tea producers in the region real time access to information on tea sales, cutting the logistics costs for the previously required travel to Mombasa for the same.
The automation is expected to increase trade in tea, benefiting the farmers and economies of tea producing countries that sell their tea thorough the Mombasa auction.
The Mombasa Tea Auction automation is in line with the trade facilitation initiatives of East African governments focused on reducing barriers to trade.
This post first appeared HERE