The East African Tea Trade Association is a voluntary organization bringing together Tea Producers, Buyers (Exporters), Brokers, Tea Packers and Warehouses, all working to promote the best interests of the Tea Trade in Africa. Currently, membership comprises over two hundred member companies extending across the East and Central African borders.
These are member companies involved in the tea planting, farming, harvesting and production of tea. The companies do production, trading and value addition of tea. Producers teas are presented by brokers at the Weekly Tea Auction held in Mombasa. The factory/farmers owns the registration mark, sends a sample of their produce to brokers in Mombasa who then send the samples to buyers for evaluation before the auction day.
Auction Proceedings at Tea Trade Centre
Mombasa has gained a reputation as a centre for some of the best CTC top grades in the world and an international blending floor with teas coming from within and outside Africa for blending. The variety of quality and progressively increased quantities offered have made Mombasa the second largest black tea auction centre in the world.
The Warehouse's function is in keeping physical custody of the tea to safeguard the interests of both the Producer and the Buyer. In this respect, the Warehouse acts at one time as the agent of the Producer and at another time the Buyer's agent. His involvement with the tea starts on the day the Producer's lorry arrives with the tea until the time the tea is placed in the vessel for onward transmission to the final consuming country.
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The East African Tea Trade Association (EATTA) is a voluntary membership organization that brings together Tea Producers, Buyers (Exporters), Brokers, Packers and Warehousemen, affording them a disciplined environment in which to interact commercially, and to promote the best interests of the trade in Africa. EATTA has been in existence for over 54 years.
A membership application form, a copy of the EATTA Profile, Producer and Buyer members’ list is attached for your information. Please note that detailed rules and regulations regarding the tea auction and trading by members are articulated in the EATTA Rules and Regulations booklet. A bound copy of the booklet is available at the EATTA Secretariat at a cost of Kshs. 250/=.
Applications for membership must be accompanied by a letter of endorsement from an authority recognized by the East African Tea Trade Association in the territory in which the applicant is registered.
Tea Board of Kenya’s written confirmation of registration by Kenyan based Packer, Buyer, Warehouse and Producer applicants must be attached prior to being considered by the EATTA.
The Tea Board of Kenya can be contacted on the following address:
P 0 Box 20064-00200 Nairobi
P0 Box 903486-80100 Mombasa
Please contact The Tea Board of Kenya prior to submitting your completed application form to EATTA.
Membership application must be proposed and seconded by producers or buyers who must have been active members of the Association for a minimum of three years. Their contacts are included on the EATTA membership list. Please refer to the criteria and requirements for proposer and seconder. All prospective members will be subject to an assessment and interview at the discretion of the Management Committee.
Requirements for Packer Membership.
- Completed EATTA membership application form.
- Tea Board of Kenya Registration Approval letter. (You will be required to submit Form 1 – application for Tea Packing and Blending Registration)
- Registration of your Trademark or a copy of the completed application form (TM2), copies of receipts for payment of application and registration to confirm process was initiated
- Health certificate for business premises
- Registration fees Kshs. 10,000
- Subscription Fees Kshs. 57,000
- Signed Principles, Code of Conduct & Ethics document (attached)
A Packer member does not access the auction directly. The packer can source teas from Producer or Buyer members. Relevant duty and taxes have to be paid for auction purchases of transit teas through Buyers.
Requirements for Buyer Membership (Exporter)
- Registration by Tea Board of Kenya.
- Written confirmation from Tea Board of Kenya
- EATTA membership application form duly filled.
- Bank recommendation letter.
- Copy of company registration certificate.
- Trading license issued by relevant authority
- Registration fees Kshs. 72,000
- PIN & VAT Certificate
- Signed Principles, Code of Conduct & Ethics document(enclosed)
All new Buyer members are required to pay Kshs. 75,000 for a standard auction seat. Payment for the seat shall grant a member entry into the Auction to bid. A Buyer member can either source his teas from the Auction, from Producers or from other Buyer members. Relevant duty and taxes have to be paid where transit teas are diverted to home use.
All new Buyer members are required to appoint a representative to attend auction and purchase tea on their behalf and to provide details of authorized signatories for tea delivery orders and other sales related documents. New Buyer members who intend to access the auction are required to deposit to the Brokers’ Association, 25% of their intended purchases for one week, prior to the date of purchase. This condition is relaxed once the buyer proves capacity to fulfill his or her financial obligations in all trade transactions.
Requirements for Producer Membership.
- Original EATTA membership form dully proposed and seconded
- Documentary evidence of ownership of tea estate (s) and or tea factory
- Average annual production of made tea by the tea factory
- Percentage of production of made tea allocated to the Mombasa Auction
- A company profile of the Producer
- An endorsement letter from a Government Authority recognized by EATTA
- Registration fees Kshs.40,000
- Signed Principles, Code of Conduct & Ethics document (enclosed)
Membership applications are reviewed and approved by the Management Committee at its bi-monthly meetings. The next meeting is scheduled for 30th May 2012 and thereafter bi-monthly. Please complete the form plus payment (banker’s cheque for the correct amount of subscription and entrance fees) and forward to the Secretariat by 15th May if you wish to be considered on 30th May.
East African Tea Trade Association
Criteria and Requirements for Proposer and Seconder
Proposers and Seconders of prospective members must themselves have been full, active members of the Association for a minimum period of 3 years and the directors/shareholders of the company or corporate applicant must be known to them personally. A member may only propose or second maximum of 8 applicants in any one year. Proposers and Seconders will be held fully responsible and liable to the EATTA for the prospective new members for a period of two years from the date of acceptance into the Association and must submit under separate cover, a recommendation letter of the prospective new member’s suitability for membership.
Definition of the various membership categories
Producers - Companies involved in the planting, farming, harvesting and or production of tea.
Brokers - Companies involved in selling of the teas on behalf of the producers, either in Mombasa Auction or by Private sale, in consideration for a brokerage (selling commission). There are currently 12 registered tea broking companies, all based in Mombasa.
Buyers (exporters) - Companies involved in buying tea, either in auction or by private sale, for the purpose of exporting that tea to various tea consuming countries around the world. This category also includes Buyers trading in the domestic market.
Packers - Companies involved in buying teas for the purposes of blending in order to create diverse qualities, and then packing into convenient, smaller – sized units suitable for selling through retail outlets.
Tea Warehouses - Companies involved in the reception of Producers’ or buyers’ teas for the purpose of safe and hygienic storage awaiting sale or export. Most such warehouses also undertake the role of preparing the tea consignments for shipment and export.
The East Africa Tea Trade Association (EATTA) Code of Conduct and Ethics is a commitment that is made by all of its Members to pursue their business activities in full compliance with all laws and to uphold the highest ethical transparent and professional standards, treating all our partners with integrity thus earning the trust of our customers, business partners, suppliers, Government and the community in general. These core values govern our operations and what we stand for and by observing the letter and the spirit of this Code we are affirming our source of pride as Members of the EATTA.
(i) Honest and Ethical Conduct
Each Member of the EATTA will maintain a high standard of conduct and character in both their professional and personal interests and will act honestly and ethically and will not be party to any illegal or improper activities. Members will ensure that those who work with them uphold the same standards through dialogue and training.
(ii) Compliance with the Code of Conduct and EATTA Regulations
The EATTA Code and Rules and Regulations are supported by the Management Committee and are set to assure all industry stakeholders that they are bound by these Rules and confirm that business will be conducted with integrity. All Members therefore should understand and familiarise themselves with the Rules and Regulations of the EATTA and Members have an obligation to follow the standards of this Code and requirements therein.
(iii) Compliance with Government Laws, Rules and Regulations
All Members of the EATTA are committed to full compliance with all Government Laws, Rules and Regulations that may apply to their activities. Any illegal activity, including fraud and corrupt practices is strictly forbidden and if proven will result in immediate cancellation of membership and notification to the relevant authorities and all parties concerned.
(iv) Conflicts of Interest
A conflict of interest arises when a Member’s personal interest interferes with the interests of the EATTA and thus making it difficult for such a Member to perform their duties objectively and effectively. Members are requested not to use their positions or other means to obtain any improper personal benefit for themselves, for their families, or for any other person. Members must declare to the EATTA Management Committee in writing that they have no conflict of interests. Any concerns as to possible conflicts should be declared in writing to the EATTA Management Committee for consideration.
(v) Internal Reporting of Concerns
All Members are encouraged to forward their concerns of any knowledge of a potential suspected or actual violation of this Code to the Management Committee of the EATTA. Failure to do so is itself a violation of the Code. Such concerns will be investigated confidentially and the EATTA will under no circumstances tolerate any form of retaliation or discrimination against any such Member.
The Management Committee will oversee the administration of EATTA’s Code and to respond promptly and professionally to any submissions or allegations that may be forwarded by its Members. The Management Committee will convene a meeting within five working days to review any reported violation and will liaise with the appropriate Sub-Committee(s). Deliberations of these meetings will be minuted and shared with the appropriate Sub-Committee(s) and the Management Committee will take appropriate action.
(vii) Certificate of Compliance
This Code of Conduct makes clear the adherence to the law and ethical behaviour. However, compliance requires a commitment by each Member who must satisfy this pledge as it will signal the Member Company’s commitment to act in accordance with the Code. We, ……………………………….………….(Name of Company) certify that we have read the Code of Conduct and understand that we individually and severally must adhere to its standards of conduct and report promptly any action that appears inconsistent with these standards.
These Companies involved in the planting, farming, harvesting and production of tea such as: Kenya Tea Development Agency Limited: Administration of the small scale farming sub-sector, currently taking their green leaf to 56 tea factories. Small-scale tea growers, estimated at 400, 000, process and market their tea through 60 tea factories under the Kenya Tea Development Agency (KTDA), while large scale tea growers (tea estates) process and market their tea through 39 tea factories operated on individual private basis. KTDA renders managerial, production, transportation and marketing services which include management of tea factories, green leaf transportation, procurement of production inputs, marketing of processed tea and payment of tea proceeds to the growers.
Currently there are about 18 companies/ managing agents in the tea industry with over 90 factories. The companies are involved in production, trading and value addition. Producers are represented by brokers at the Weekly Tea Auction held in Mombasa. The factory/farmers who own the registration mark send a sample of their produce to brokers in Mombasa who then send the samples to buyers for evaluation before the auction day. They then meet with the buyers at the weekly auction for trading.
The Twelve Tea Brokers who auction in the Mombasa Tea Auctions have this year alone represented tea Producers in Kenya, Uganda, Tanzania, Rwanda, Burundi, Malawi, Congo, Zambia, Zimbabwe, Mozambique and Seychelles. Collectively, the brokers form the Tea Brokers' Association, which functions under the Constitution Rules and Regulations of the East African Tea Trade Association (EATTA).
A prospective broking company must apply for membership to the EATTA through a proposer and a seconder. It must prove that it has the support of its respective producer principals who must in turn provide written commitments to sell given volumes of tea through the prospective broker. The candidate firm must also have in its employment at least two senior members of staff who are fully conversant with the tasting, reporting and valuing, selling in auction and generally representing the producers' and buyers' interests effectively and with integrity. The candidate must provide evidence of good financial standing, and may be required by some producers to provide substantial bank guarantees as security for teas placed for sale. Finally, the prospective broker must be independent and impartial, and can therefore not hold any interests in tea producing or buying enterprises.
Virtually all the producers currently choose to sell moderate to substantial volumes of their teas through the auctions, which are considered to be thoroughly transparent, and which provide a forum for international buying. The result is wide exposure and forceful competition.
Producers deliver their teas to appointed warehouses in Mombasa, and advise their brokers as to which of the teas are to be sold in auction. The broker then prepares a selling catalogue, giving specific information about every line or 'lot' (comprising 20, 40, 60, 80 or 100 packages). Details include origin, quantity, weight, grade and method of packing. The producer also provides the broker with a 4 kilogram representative sample from each lot of tea. This is apportioned and distributed to all active buyers, for tasting and assessing quality and value by the buyers and/or their overseas principals. Catalogues are also distributed to buyers, producers and warehouses.
Tasting is a skill that is taught and gradually refined over years of experience. The broker tastes all the teas in the catalogue and reports his observations and recommendations on quality to the producer. He also attaches a value to each tea tasted, based on his perception of the existing market forces.
Auctions take place each Monday morning in a purpose-built Auction Room at the Tea Trade Centre. Main Grades are sold from 8.30 am, while Secondary Grades are sold in a separate room starting at 9.30 am. Brokers sell in rotation. The selling broker announces the line of tea on sale, and invites bids in US dollars per kilogram. The buyers announce their bids, which advance by at least one US cent per kilogram. The tea is knocked to the highest bidder, and the next lot is offered for sale. Certain larger lot quantities may be shared by a maximum of three buyers. All these details are recorded in the catalogues.
After the sale, the broker returns to his office to prepare invoices and export licences for the buyers, confirmations of sale, account sales and market reports for the Producers. He also communicates with the producer/factory to discuss the day's market and price performance.
The EATTA rules require buyers to pay the broker on or before the Prompt Date, which is precisely ten working days from the date of sale. Penalties for non-compliance are appropriately punitive and extreme cases may result in being barred from buying or even expulsion from the Association. On proof of payment, the buyer receives Delivery Orders from the broker to enable him to take delivery of his purchases from the warehouse.
The same prompt date requires the broker to remit the sale proceeds to the producer. The rules of the Association are specific that Mombasa brokers are "guarantee brokers" and must undertake to remit sale proceeds to producers irrespective of whether they themselves have been paid by the buyers. Despite this tringent requirement, there are yet no recorded incidences of any broker having failed to meet this deadline.
The EATTA rules also specify that a broker will earn a commission on each price realised in the sale, the rates currently applicable being 1% from the producers and 0.5% from the buyers.
Brokers frequently visit their principals and the factories in order to consult on manufacture and quality, weather and production patterns, market trends in relation to the other tea auctions in the world, and future strategies. They also visit and liase closely with the warehouses to ensure that the producers' teas are received, handled, stored and delivered in a professional manner. Furthermore, brokers take the responsibility of addressing claims by buyers as to the quality or quantity of the teas purchased. Brokers, three of whom are elected annually to the EATTA's Management Committee, meet from time to time to address areas of concern in their profession, to forge closer ties with other members of the trade, and also to agree on representations to the Association. They are fully committed to the principals and the spirit of the EATTA. They take seriously their role in the industry and jealously guard their reputations and their integrity.
A company registers itself in Kenya and applies for membership in EATTA.
Companies involved in buying tea, either in auction or by private sale, for the purpose of exporting that tea to various tea consuming countries around the world. This category also includes Buyers trading in the domestic market.
Companies involved in buying teas for the purposes of blending in order to create diverse qualities, and then packing Into convenient smaller wed units suitable for selling through retail outlets.
Some of the leading packers include Kenya Tea Packers (KETEPA), Unilever Tea and Kikuyu Highlands Tea Company.
The Producer delivers the Teas to a Warehouse of his choice in Mombasa (or Nairobi) depending on the condition of sale. The receiving Warehouse ensures that the Tea is received in good condition and all the documentation is correctly prepared. The Warehouse should be an EATTA approved Warehouse in conformity with the Association's specified minimum standards. The Warehouseman's function, in keeping physical custody of the tea, is to safeguard the interests of both the Producer and the Buyer. In this respect, the Warehouseman acts at one time as the agent of the Producer and at another time the Buyer's agent. His involvement with the tea starts on the day the Producer's lorry arrives with the tea in Mombasa until the time the tea is placed in the vessel for onward transmission to the final consuming country.
The Factory accords each consignment an identification number, known as a Factory invoice number. The Warehouse documents, prepared on receipt of the consignment should relate to the Factory details showing the weight per package, the mode of packing and grade. The Warehouseman has to ensure that the tea remains intact both in respect of quality and quantity and is ready for delivery on demand. These functions require extensive capital investment in buildings, machinery, equipment and dedicated staff. There are currently eighteen Warehouse members of the EATTA.
Once collected by Buyers, most Teas are exported in original packaging. Where required as a service to Overseas Buyers, Teas are "blended" to a particular standard and price. This has many benefits of cost saving for the Buyer and provides employment opportunities in Mombasa.
Nearly all Teas shipped from Mombasa are moved in containers either 20 or 40 ft which is a most effective mode of transport, virtually eliminating damage and losses in transit.
The Tea Trade is very much a Team affair and the Team players of Producer - Warehouseman - Broker - Buyer are all very interdependent on each other.
- DR CONGO
Tea Association of Malawi
Founded in 1934, the Tea Association of Malawi Limited (TAML) is one of the oldest organisations in Malawi. TAML was established with the aim of representing the entire tea industry both nationally and internationally on matters of interest to tea growers and producers. The association dates back to before Malawi received its independence in 1964. Before that date the Nyasaland Tea Research Association body founded with research as its main objective, had been in existence for about five years. The TAML meets regularly and delegates specialized work to appointed committees. The association also maintains close links with the Tea and Merchants Association, a sister organisation on the trading side to buy and sell teas on local auctions on behalf of the overseas principals. Members of the tea association are from time to time also invited by the association to be represented at joint meetings or committee meetings whenever a common interest occurs. Malawi is the second largest tea producer in Africa, second only to Kenya. It is estimated that the nation supplies approximately 10 percent of tea produced on the African continent. Malawi was the first country in Africa to grow tea on a commercial scale and has been producing tea for well over a century.
Rwanda Tea Authority
Tea growing was introduced in Rwanda as an industrial crop and purely for export purposes to generate foreign income as early as 1960. Black tea manufacturing followed in 1965 at Mulindi tea factory in the Northern Province. Since then the tea sector has become the most important source export earning after the coffee market plunged in recent years. Tea is now number one export earner ; contributing up to 34% of the total national exports.
Today, the tea sector in Rwanda consists of six state owned production units, i.e Gisovu, Kitabi, Mata, Mulindi, Shagasha, Gisakura and four private owned production units, i.e Cyohoha (SORWATHE), Pfunda (Pfunda Tea Company),Nyabihu and Rubaya ( Rwanda Mountain tea). Nshili-Kivu is another private owned production unity with a factory still under construction.
The current tea sector consists of 10 tea factories, 8 government owned plantations known as Blocs Industries (BI), 3 tea cooperatives known as Coopthés and 11 tea small holders associations known as Thé Village is spread in the country as indicated in the table below, Structure and distribution of tea production units.
The total planted area is 12,862 hectares. The factories installed capacity is 15,500 tones of made tea per annum. The tea sector provides employment to 52,838 people, tea farmers and workers together.
Tea Association of Tanzania
The Tea Association of Tanzania was formed out of The Tanganyika Tea Growers Association (TTGA) which was established in 1940s by large scale tea producers to promote the common interests of the plantation sub-sector members in the cultivation and manufacture of tea, and to promote good industrial relations and sound wage policies for their workers. In 1988 the TTGA merged with the Tanzania Tea Producers Association (TTPO) to form The Tea Association of Tanzania (TAT). This change was partly necessary so that it could accommodate the Blending sub sector of the Industry and the Tea Authority.In 1996 TAT spearheaded the establishment of The Tea Research Institute of Tanzania (TRIT) which was the first private research institute to be set in Tanzania.
Uganda Tea Association
Uganda Tea Association (UTA) is the umbrella body of 95% of tea farmers and processors both small and big in Uganda. UTA was formed in 1948 as a voluntary Association of Tea Producers to meet and discuss common problems affecting the tea industry and find solutions. The Association continued to be active throughout the period of Uganda’s history; except for the period from1973 till 1983 when it remained dormant.
The Association also carries out lobbying against emerging issues or likely to emerge and affect the industry negatively and vise-versa. It encourages the promotion of fair conditions of employment within the industry, promotes better industrial relations, occupational health and safety standards, collecting and circulating information on tea industry. UTA cooperates with National and International organizations in matters related to planting, manufacturing, packaging of tea and the tea industry in Uganda in general.