Kenya’s vast tea gardens are ideal for automation but with only four in 10 employed and a government mandate to add 1 million jobs, any effort to replace pluckers with machines is politically unpopular. A three-week strike that cost large-scale growers an estimated $3.9 million may tip the balance, according to industry executives.
Kenya’s Industrial Court last week ordered the Kenya Agricultural and Plantation Workers’ Union (KAPWU) to suspend the strike with all parties required to meet in court this week, according to news reports. KAPWU general secretary Francis Atwoli appealed to workers to respect the court’s directive and return to work, reports Daily Nation.
Kenya is the world’s third-largest tea grower. While the great and growing majority (56%) is farmed by smallholders, about 44% of the 416,000-metric ton crop was in jeopardy the past few weeks as 16,000 organized tea pickers and factory workers stayed home. The court ordered growers not to fire striking workers and ultimately moved to settle the strike by enforcing a ruling that gives workers a cumulative 75% wage increase.
The Kenya Tea Growers Association (KTGA) will now pay a minimum daily wage of Sh513 ($4.95). Growers say the increase will bring the cost of labor to 54% of total production expenses. They estimate break-even at $1.78 per kilo. India, by comparison, produces comparable black crush, tear, curl (CTC) teas at a cost of $1.60 per kilo that sells for $2.85 per kilo. Malawi tea can be produced for $1.19 per kilo.
The East African Tea Trade Association reports the average sale price of $2.86 per kilo at the Mombasa Tea Auction. Thin margins will increase the pace of automation, according to KTGA CEO Apollo Kiarie. In 2016 about 40% of the 207 million kilos of estate grown tea was machine harvested by multinationals including Unilever, James Finlay Kenya, and Williamson Tea Kenya.
“Those employers who have not installed even a single plucking machine will be compelled to start thinking about it,” Kiarie told Bloomberg News, Nairobi. “This strike is the nail in the coffin. Automation has to be done, but gradually. You wait for natural attrition to take place, and then you don’t replace,” he said.
Henry Omasire, the KAPWU’s national organizing secretary, said the union “is in court and talking to county governments to come up with bylaws to regulate this mechanization issue, because if we don’t do that, there will be a lot of insecurity in those areas in the future, because the boys will be unemployed.”