Tea prices in Pakistan may rise after Kenya proposed a new export levy. Industry representatives have urged Kenyan authorities to reconsider the decision. The concerns emerged during a meeting at the Kenya High Commission in late May. Officials from both countries discussed the potential impact of the measure.
Pakistan Tea Association representatives attended the meeting alongside Kenyan government officials. They requested the withdrawal of the proposed 0.8 percent export levy.
Pakistan Warns of Higher Consumer Costs
Pakistan Tea Association Chairman Muhammad Altaf said Pakistan remains a key market for Kenyan tea. The country imports nearly 36 percent of Kenya’s annual tea production. He noted that Pakistan also receives additional Kenyan tea through regional trading hubs. Therefore, any increase in export costs could significantly affect local markets.
According to Mr Altaf, the levy would add pressure on tea prices. Furthermore, consumers already face challenges from economic uncertainty and rising costs. He highlighted increasing freight charges, packaging expenses, and import-related pressures. Consequently, the proposed levy could further contribute to food inflation.
Tea remains a staple household commodity across Pakistan. As a result, higher prices may reduce overall consumption nationwide.
Importers May Seek Alternative Tea Suppliers
Industry representatives warned that continued implementation of the levy could reshape import patterns. Importers may begin exploring alternative sourcing options. Potential suppliers include Sri Lanka, Indonesia, and Bangladesh. Additionally, several African tea-producing countries could benefit from shifting demand.
Traders believe the move may affect volumes throughout the tea supply chain. Reduced imports could impact distributors, retailers, and consumers alike.
The Pakistan Tea Association informed Kenyan officials about these concerns. It specifically requested an exemption for tea exports destined for Pakistan. For now, importers await a final decision from Kenyan authorities. However, industry observers expect the issue to remain a key concern for the tea sector.
