Farmers contracted by BAT Kenya were paid Sh1.4 billion for their delivery of tobacco leaf last year, with their earnings from the cigarette manufacturer rising 27 percent from Sh1.1 billion in 2024.
Growers’ earnings have been disclosed by the Nairobi Securities Exchange-listed firm in its latest annual report.
The company’s payouts to farmers has been rising in recent years as it recruits more producers to feed its manufacturing and processing of cigarettes and cut rag (semi-processed tobacco) that are sold in the local and export markets.
BAT recruited an additional 570 farmers last year, raising their count to 2,440 from 1,870 in 2024.
‘Our leaf growing operations in Kenya are concentrated in the counties of Bungoma, Busia, Migori and Meru, where we partner with a majority of local tobacco farmers through annual contracting,’ BAT said in the report. The company still derives the bulk of its revenue from cigarettes but has taken steps to diversify the business with the relaunch of nicotine pouches in the second half of 2025.
Revenue from the new products stood at Sh154 million last year. The company had introduced nicotine pouches, which it says are less harmful compared to combustible cigarettes, in 2019.
Sales were, however, suspended in 2024 due to regulatory uncertainty. ‘The reintroduction of smokeless products in the Kenyan market reflects our efforts to respond to the evolving preferences of adult smokers while supporting the transformation of our business through the development and availability of alternative nicotine products,’ BAT said.
Revenue from cigarettes still dominated at Sh22.3 billion in the year ended December 2025, followed by cut rag sales which yielded Sh724 million.
BAT supports its farmers to diversify the crops they grow besides providing them with loans and technical expertise in a strategy aimed at promoting their economic resilience.
‘We encourage our farmers to grow alternative crops after harvesting tobacco, to enhance food security and soil nutrition,’ the company said.
‘To facilitate this, we provide seeds for subsistence crops, including certified maize seeds at no cost. Additionally, depending on the season, to further enhance crop diversification, we provide seeds for other crops and plants at market competitive rates.’
Tobacco is among the country’s cash crops that earn Kenyan farmers billions of shillings each year. East African Breweries has also contracted thousands of sorghum growers in Western Kenya who earn over Sh2 billion per year for their produce.
BAT reported a net income of Sh5.25 billion in the year to December 2025, marking a 17 percent rise from Sh4.4 billion the year before.
The profit growth was helped by lower operating costs.
BAT’s gross sales including indirect taxes fell 12.5 percent to Sh35.95 billion, attributed by the company to growing incidence of illicit cigarettes in the domestic market.