DHAKA (Reuters): Tea prices in Bangladesh rose nearly 1% at the weekly auction on strong demand for quality leaf despite a higher volume on offer.
Bangladeshi tea fetched an average of 209.34 taka ($2.60) per kg at the weekly auction on Tuesday, compared with 207.13 taka in the previous sale, the National Brokers said.
There was strong demand for quality tea and buyers were ready to pay premiums although supplies were higher than last week, a senior National Brokers official said.
About 15% of the 2.82 million kg offered at the sole auction centre in Chittagong remained unsold. In the previous auction, 9% of the 2.40 million kg on offer was unsold.
Bangladesh’s tea output rose nearly 27% last year to a record 85 million kg, a harvest that was seen as being big enough to make imports unnecessary.
The south Asian country was the world’s fifth-largest tea exporter in the 1990s, but is now a net importer due to a surge in domestic consumption.
Bangladeshi buyers have imported tea in bulk from India, Thailand and Malaysia, contributing to a glut in the domestic market and reducing demand at auctions, industry insiders said.