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Description

Agriculture is a key sector of the Nyamira County economy and employs the largest number of residents in a single sector. Agricultural activities include food and cash crop farming, livestock farming as well as aquaculture. Under the new constitution agriculture functions are devolved and county governments can leverage public-private partnerships (PPPs) to enhance agricultural production and productivity.

Nyamira county Government has prioritized agricultural production and value addition as one of the key drivers of the county economic development. Developing a strong value chain increases the market competiveness and spreads benefits to different actors in the value chain, this in turn creates opportunities for employment for the youth and women.

Tea is the main cash crop grown in Nyamira County and its grown in all the 20 wards, the sector is a source of livelihood for 90% of the local residents directly and indirectly. There are over 20,000 small scale tea growers supplying raw materials to 6 tea processing factories the uses about 90,000-100,000 tonnes of Greenleaf which processed into black tea all the year round. However many opportunities exist to diversify the tea products in order to increase the farmers’ income as well as creating employment to the well-educated youths in the county

Project sponsors

The proposed tea investment opportunities can be a joint venture with:

1. The Nyamira County Government,
2. Private investors both local and foreign
3. The tea growers through the cooperative societies.

Product mix

The possible products for the tea value addition include diversification to purple tea, tea juice, packaging material production, blending/flavouring of the black tea with spices or herbs products (ginger, masala, lemon).

Packaging into different weights for consumers can be done into various weights.

Pre-mixed tea with sugar and milk ready for use especially for young families, green tea from the appearance due to prevention of aeration during processing

Key players

Kenya Tea Development Agency (KTDA)

Is a farmers owned agency responsible for developing and fostering the small scale tea farmers in Kenya, the agency manages the tea factories that are owned by the farmers

The Tea Board of Kenya (TBK)

It regulates the tea industry in Kenya by provision of licences, registration and promotes adherence to tea regulations by all players

Tea Research Foundation (TRF)

Carries out the research activities in the tea sector especially for improved production through the best agronomic practices

Raw materials availability

The raw material for the black tea products are readily available within the county and the region, however the purple tea production will be started if an investor commits to process the products since the planting materials are available from other farmers in the country or from the tea research centre at Kericho

Production Plan

This will involve feasibility studies and recruitment of the purple tea growers in the first year as the infrastructure facilities are put in place.

The processing facilities can be set up on land provided by the county Government as a partner while the investors provide the capital to start off the enterprises

The production plan will be done in phases

Phase 1

• Production of blended , flavoured black tea
• Production of pre-mixed tea
• Packaging into sachets/tea bags

Phase 2

• Introduce the green and purple tea
• Production of instant tea
• Optimize the production levels

 

Estimated Investment cost

Start-up Costs
Item	Estimated Cost (Kshs)
Company registration and licencing	500,000
Insurance	1,000,000
Traveling expenses	1,000,000
Feasibility study, EIA and legal fee	3,500,000
Sub Totals	6,000,000
Investment costs
Land and building	80,000,000
Plant and equipment	200,000,000
Other assets	10,000,000
Working capital	30,000,000
Sub Totals	320,000,000
TOTAL	325,000,000

 

The investment will cost about Kshs 325 million (3.8 million US dollars) depending on the facility size and equipment to be used

Economic and social indicators

The investment opportunity is conducive because the demand for the tea products is available locally in Nyamira County as well as the neighbouring counties and the lake region the has a population of over 10 million residents, the venture will also give the small scale farmers an alternative for the tea and reduce tea hawking in the county apart from providing employment to the skilled youths for poverty reduction.
 

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