Kenya’s tea sector faces significant supply chain disruptions and rising costs as escalating conflict in the Middle East interrupts critical air and sea routes to key Gulf markets, including Iran.
The sector’s vulnerability stems from its reliance on timely shipments to the region. Iran is a top ten destination for Kenyan tea, importing approximately 13 million kilograms valued at 4.26 billion Kenyan shillings (about $33 million) in 2024. Combined with coffee and spices, these products constituted over 90% of Kenya’s total exports to Tehran, worth roughly $45.23 million. While Pakistan remains the largest single market, Gulf states and Iran provide a vital secondary outlet, helping manage supply during periods of high production.
Current military actions and airspace closures across Iran, Iraq, and the Gulf have directly hindered cargo flights and maritime traffic. Although some routes remain open, airlines and freight operators have suspended services due to safety concerns and insurance limitations. The Strait of Hormuz, a chokepoint for global oil shipments and regional trade, has seen shipping disruptions following attacks on vessels. These interruptions are driving up freight rates, extending transit times, and increasing war-risk insurance premiums.
For Kenyan tea exporters, who operate on narrow profit margins, these mounting logistics costs threaten competitiveness against rivals from India and Sri Lanka. The pressure is particularly acute for premium tea varieties, which are highly sensitive to delivery delays that can affect quality.
An indirect but substantial risk involves Kenya’s own energy imports. The country sources most refined petroleum from Gulf producers like Saudi Arabia and the UAE, with shipments frequently transiting the Strait of Hormuz or conflict-affected airspace to reach Mombasa. Prolonged disruptions could elevate global oil prices, subsequently raising domestic fuel and transport costs that feed directly into tea farming, factory operations, and distribution.
While Kenya has diversified its tea export reach—serving 96 international markets in 2024—the Gulf remains essential. Pre-crisis, Kenya and Iran were negotiating expanded agricultural trade for 2025-26, plans now clouded by instability. The immediate challenge for exporters is navigating volatile logistics and cost structures to maintain market presence. With no swift de-escalation in sight, the stability of Kenya’s tea shipments from its western highlands to Gulf consumers is now inextricably linked to geopolitical developments far beyond its borders.
