Satemwa is one of the last family-owned tea estates in Malawi, employing up to 2,500 workers. But the pressure is on to create long-term livelihood opportunities for the 187 smallholder farmers (of which 85 are women) and tea workers while changing market views of Malawian tea. Sales and Marketing & Business Development Manager Wouter Verelst explains how they aim to do it.
“Being a producer in an African business climate pushed us towards more value addition to overcome the commodity trap,” says Wouter. “Part of this translated to setting up our own marketing and sales office in Europe to promote Satemwa teas.”
The aim is threefold: to be closer to customers and end consumers; to play on upcoming demands and trends in the tea and coffee sector in Europe; and to increase producers’ share in the value chain.
To do this, the company wants to change attitudes to Malawian tea, which has struggled to build a strong reputation in the marketplace. “Most Malawian tea ends up in a blend, it’s just filler tea,” says Wouter. “We want to encourage higher quality products, creating a USP through using varieties that only grow in Malawi. These have a unique taste that few people know about.”
Diversification is key
Over the past 15 years the estate has been growing whole leaf teas including white, green and oolong. “We are further diversifying into herbs and flowers, to add to our chai,” says Wouter. “We flavor our teas with smallholder grown hibiscus, passion fruit and peach, and people like it.” By doing so the company is looking to encourage a strong national and regional market, setting up new value chains that work over more than one season to support smallholders more effectively.
Wouter believes that part and parcel of this increased quality is membership of certification schemes – the tea estate has been UTZ certified since 2008.
“Certification helps us fine-tune our products,” he says. “A certification label gives added value, our sales figures prove that there is demand and that the investment we’ve put into certification has been worthwhile.”
A certification label gives added value, our sales figures prove that there is demand and that the investment we’ve put into certification has been worthwhile.
Satemwa has also recognized that transparency on means of production is a concern for consumers. “We have been at the forefront of these demands, and UTZ certification was a way to formalize this and to have our efforts noted.”
In 2014 Satemwa launched a smallholder-owned brand, Yamba (meaning ‘to start’) with 198 local farmers, all of whom are UTZ certified. “Normally smallholder farmers have to bow to world commodity prices, and they get next to nothing for their tea. So we looked at different answers, and one of the best was to launch Yamba,” says Wouter.
Farmers have been able to tap into the decades of business and marketing knowledge held by estate management, and together they set up and designed a brand, and formed an agreement that Satemwa would produce and pack the tea, with smallholders receiving 4% royalties for each pack sold.
“By sharing our expertise we made the step towards full production much more accessible for farmers, and they also see an increase in returns. This fits well with our focus on value addition at the point of origin.”
Stories behind the tea
Wouter believes that the current buzzword in the market as a whole is sustainability and the true stories behind the tea, and that, “the main challenge is to tell that story to the end consumer so that the whole value chain realizes there is much more craftsmanship and work behind the teabag in your hand than you would expect.”
“If you look at wine or coffee, this story is already being told, but it isn’t with tea. I do think that this is the way forward, and the kind of thing that consumers will ask for more and more. We have to start getting inspired by these different industries.”
There’s no doubt that the pressure is on, but Satemwa will continue to look for innovative ways to grow in the future.
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