Huge Profits on tea, coffee and macadamia companies in Kenya
Listed agricultural firms have reaped from gains in commodity prices over the last year helping to fuel the growers’ sales and earnings.
Among agricultural commodities to record an uplift through the past year include tea, coffee and macadamia.
Grower Sasini Plc which more than doubled its 2022 full-year profit to Sh1.2 billion from Sh573.2 million was a beneficiary of the price windfall.
The company marked a 36.3 percent increase in turnover to Sh7.34 billion in the backdrop of improved returns in the marketplace.
Sasini for instance fetched Sh220 per kilo of tea sold from Sh179 per kilo in the previous year to mark the highest return on the commodity in more than five years.
The price of macadamia sold by Sasini meanwhile rebounded to Sh1,720 per kilo from Sh1,429 in the preceding year.
Nevertheless, the price of hass avocado per carton slumped to Sh636 from Sh671 but was higher than Sh514 in 2020.
Other growers have marked a similar rebound in turnover from products sale with Kakuzi for instance defying challenges including oversupply, drought and a consumer spending freeze to post Sh1.026 billion in sales in six months to June 2022 from Sh888.9 million in the preceding half-year period.
“Increased demand for our teas coupled with the weakening shilling resulted in improved performance for the period,” the company said.
Limuru Tea, Eaagads and Williamson Tea meanwhile reversed loss positions on the back of carbon-copy gains on commodity prices.
The three firms posted profits of Sh5.9 million, Sh37.2 million Sh246.9 million after returning losses of Sh8.6 million, Sh376 million and Sh7.8 million respectively.
Limuru Tea said favourable black tea prices pulled it back from the red despite what was a challenging operating environment at the half-year stage.
“The increase in the first half of 2022 is driven by favourable black tea market prices and the continuous improvement of tea quality,” the grower said in a trading statement.
Despite the lift provided by higher commodity prices, the growers face inflationary pressures in the form of increased production costs and unpredictable weather patterns.
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