Kenya's tea exports have been severely hit by the shortage of letters of credit (L/Cs) in Egypt.

The country's tea exporters are now seeking other markets in a bid to make up for the lack of buyers in Egypt where the economic crisis continues.

No sales

At least one of Kenya's weekly tea auctions in July saw no tea at all sold to Egyptian buyers, according to the Tea Board of Kenya (TBK).

It is now aggressively marketing the country's tea to alternative markets in China, Pakistan, Sudan, Somalia and Europe to compensate for a dip of 20 per cent in tea exports.

L/C shortages

According to a TBK report, Egypt's banks continue to experience operating difficulties while there is limited commercial activity visible as demonstrations continue.

Tea buyers in Egypt are not placing orders, as they cannot transact on normal terms due to L/C shortages, the report said.

Sharp fall

The average price for Kenyan tea fell 4.4 percent to US$2.41 per kilogram at an auction last week from the sale in the previous week.

The TBK nevertheless says Egypt that remains a leading market for Kenyan tea, and it hopes that the situation will normalise.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.