Over 700,000 Kenyan Tea Farmers to Receive Annual Bonuses Under Factory-Based Payment System
More than 700,000 smallholder tea farmers across Kenya are set to receive their annual bonuses this week alongside September earnings following the release of payments by the Kenya Tea Development Agency (KTDA). KTDA Holdings Chairman Enos Njeru confirmed that the funds were released on Friday, October 9, with farmers expected to access the money from Monday during normal banking hours.
The payments come as growers await their second payment for the 2025/2026 financial year, with bonus rates varying significantly across tea factories depending on revenue and operating costs. This year’s bonus declaration process gives individual factories responsibility for determining their own rates, rather than relying on a single declaration by the KTDA board. The change is expected to reflect differences in factory performance, tea prices and the costs of processing green leaf.
The 77 KTDA-managed factories have been organised into 54 operational units, including satellite factories operating under larger mother factories. The total amount to be distributed in this year’s bonuses has not yet been established.
Available figures indicate that bonus rates are expected to range between Sh12.50 and Sh50 per kilogramme of green leaf, depending on the factory. The differences have renewed concerns among farmers about the factors determining annual earnings.
Last year’s payments provide a measure of the financial pressures facing the sector. Tea farmers received Sh69.8 billion during the 2024/2025 financial year, down from Sh89.6 billion in 2023/2024. Official figures for the 2025/2026 financial year are yet to be released.
The amount paid to growers depends partly on the prices their factories obtain at the Mombasa Tea Auction and through direct sales to domestic and international buyers. These prices are influenced by demand, tea quality and market conditions.
Growing conditions also affect the quantity and quality of green leaf delivered to factories. Rainfall, altitude, soil characteristics and farm management practices can influence yields, while timely plucking, pruning, weeding and appropriate fertiliser use help maintain tea quality and production. Factory operating expenses further determine how much revenue remains available for farmers. Electricity, firewood, fuel, water, leaf collection, equipment maintenance, staff wages and loan repayments all contribute to processing and marketing costs.
Currency movements also affect earnings because Kenyan tea is traded in international markets. Changes in the shilling’s value against the US dollar can influence the returns factories receive from export sales during the financial year.
The bonus calculation covers the financial year ending June 30, making the performance of tea sales and the costs incurred over that period important in determining final payments. Kenya’s smallholder tea sector is broadly divided into the West of Rift and East of Rift growing regions. Differences in climate, production volumes, tea quality and market returns can contribute to variations in earnings between factories in the two regions.
The release of the September payments and annual bonuses will provide farmers with funds for household expenses, loan repayments and reinvestment in their farms. However, growers continue to seek greater transparency in how factories calculate second payments and explain differences in the amounts received.
As farmers access their money, the industry faces continued pressure to improve operational efficiency, strengthen tea marketing and ensure that better market returns translate into improved earnings for smallholder growers.
