Tea prices fell sharply at Bangladesh’s weekly auction on Tuesday, dragged down by inferior quality leaf, despite a lower volume on offer.
Bangladeshi tea fetched an average price of Tk 188.44 ($2.80) per kg at the auction, compared with a revised price of Tk 200.01 in the previous sale, National Brokers said.
Prices dropped sharply as buyers sought big discounts for poor-quality tea, of which there was a large supply, despite a drop in overall supplies, a senior official at National Brokers said.
About 25.5 per cent of the 2.27 million kg offered at the sole auction centre in Chittagong was unsold, compared with 38 per cent unsold of the 2.7 million kg offered at the previous auction.
Bangladesh’s tea production jumped nearly 27 per cent in 2016 to a record 85 million kg, helped by favourable weather, making imports a choice rather than a necessity.
The South Asian country was the world’s fifth-largest tea exporter in the 1990s but is now a net importer because of a surge in domestic consumption in line with economic growth.
Following are the results of the latest auction (figures in Bangladesh taka per kg):
Bold/Large Brokens not quoted
Medium Brokens 170-180
Small Brokens 175-190
Plain Brokens 145-165
Best Fannings 210-215
Good Fannings 190-200
Medium Fannings 180-185
Plain Fannings 155-175
Pekoe Dust not quoted
Red Dust 172-240
Churamoni Dust 164-250