Stanchart in Sh3.5B financing deal with KTDA for fertilizerMay 21, 2019
NAIROBI, Kenya, May 14 – The Kenya Tea Development Agency (KTDA) has today signed a Sh3.5 billion financing deal with Standard Chartered Bank Kenya Limited for the purchase of 95,000 metric tonnes of fertilizer to be distributed to KTDA tea farmers across the country.
The deal, which is part of KTDA’s fertilizer supply program for farmers, will see over 650,000 farmers who own the 69 factories that KTDA manages benefit from supply of fertilizer through the arrangement.
Speaking during the signing ceremony, KTDA Group Chief Executive Officer, Lerionka Tiampati, said that the move will help farmers access affordable fertilizer that will go towards improving the quality and yield of their tea.
“We are pleased to be signing this partnership with Standard Chartered Bank Kenya Limited as it will enable us acquire fertilizer which we will be distributed to our farmers at the most competitive rates we can obtain. The fertilizer will assist farmers improve the yield and quality of their green leaf.
He added: “This fits well with our long-term strategic objective to continuously work towards providing smallholder tea farmers with a wide-range of cost-effective solutions for their everyday farming requirements.”
Speaking at the same function, Standard Chartered Bank Kenya Limited Chief Executive Officer, Kariuki Ngari, said that the bank is proud to be supporting KTDA in this endeavor adding that the strategic partnership is in line with the bank’s objective of offering tailor-made solutions to its clients.
“We are delighted to be announcing this partnership with KTDA as it seeks to provide affordable fertilizer to its members. Tea is a key export sector that earns the country much needed foreign exchange. Standard Chartered Bank is therefore at the forefront of driving agriculture through corporates like KTDA and hence bringing prosperity to farmers,” said Ngari.
This financing is in line with our Brand Promise “Here for good”, while at the same time supporting sustainability in the tea sector as well as providing bespoke solutions to all our clients,” he said.
In entering into the arrangement, KTDA is leveraging on economies of scale afforded to it by its size to obtain the most competitively priced fertilizer in an international open tender.
The fertilizer is set to arrive in July and August for subsequent distribution to farmers for their use at the onset of the short rains.
Last year, through a similar arrangement, KTDA procured and distributed fertilizer for farmers at Sh1,774 per 50kg bag against the prevailing market of Kshs 2700.
Farmers will start receiving the fertilizer from the end of July, with the quantity of fertilizer a farmer receives depending on the number of tea bushes owned. On average, a 50kg bag of fertiliser is applied to 700 bushes. The fertiliser requirement is usually determined in November and December ahead of procurement in the following year.