THE ROLE OF THE TEA BROKER

 The Tea Brokers hold a key position in the value chain within the trade. In this information age, they sit at the confluence of multiple streams of data, creating value for the teas that they handle, and based on subjective factors as quality, supply and demand and prevailing market environments.

Tea Brokers operate under the auspices of the East Africa Tea Trade Association (EATTA) which is a voluntary, non-profit umbrella body representing the interests of the tea industry in Africa.

EATTA is the auction organizer that runs the weekly Mombasa Tea Auctions and is guided by clear rules and regulations that are under periodic consultative review. The Tea Brokers hold a key position in the value chain within the trade. In this information age, they sit at the confluence of multiple streams of data, creating value for the teas that they handle, and based on subjective factors as quality, supply and demand and prevailing market environments.

Market intelligence: understanding existing tea market dynamics through consulting widely with producers and buyers to appreciate the supply and demand positions of both parties, and by doing so to arrive at projections of anticipated market behavior. Additional knowledge is garnered by research in local and international news on tea, and by keeping abreast of local and international regulatory initiatives affecting the Sector.
Marketing: the Broker’s constant interaction with the Buyers (Exporters) enables him to understand the market requirements, which he passes on to the Producer to meet.
Auctioning: this crucial skill enables a Broker to conduct the sale of teas in a regulated and highly competitive setting aimed at selling large amounts of teas to Buyers (Exporters) at the highest possible market price. The ability to make correct instantaneous decisions under pressure in accepting or refusing Buyers’ (Exporters’) bids is crucial ability.
Monitoring the timely payment of sales proceeds by Buyers (Exporters) and remittance of the same to Producers. Buyers (Exporters) must pay in full for their purchases within a specific deadline known as the “prompt date”, which in the case of Mombasa Auctions is 10 working days from the date of the Auction. Once this is fulfilled, Brokers release documents of title to the teas to the Buyers (Exporters), enabling them to take delivery for shipment to their clients.
Consulting: The Broker consults with both Producers and Buyers (Exporters) so as to gain knowledge that can be conveyed from one party to the other. A Broker uses this knowledge to contribute consultatively towards the production of an acceptable quality of tea, and by so doing maintain Buyers’ (Exporters’) loyalty and help to improve the auction price realized.