Tea prices in Bangladesh dipped more than 7 percent at a weekly auction on Tuesday, dragged down by inferior-quality leaf, following a small rise in the previous auction.
Bangladeshi tea fetched an average of 126.56 taka ($1.6) per kg at the auction, down from 136.38 taka at the previous sale, the National Brokers said in a market report.
Buyers showed little interest in the end-of-season leaf that tends to be of inferior quality, leaving a huge quantity unsold despite a drop in supplies, said a senior official of the National Brokers.
Competitive prices, however, attracted buyers from Pakistan, the official added.
About 30.7 percent of the 1.9 million kg offered at the sole auction centre in Chittagong was left unsold.
In the previous auction, about 33 percent of the 2.1 million kg on offer remained unsold.
Bangladesh's tea production in 2016 is expected to have risen to a record 80 million kg from 66 million a year earlier, Commerce Minister Tofail Ahmed said, output that may be big enough to make imports unnecessary.
From a net exporter, Bangladesh has now become a net importer of tea due to an increase in consumption.
Following are the results of the latest auction (figures in Bangladesh taka per kg):
Brokens
Bold/Large Brokens 80-90
Medium Brokens 90-120
Small Brokens 100-125
Plain Brokens 70-85
FANNINGS
Best Fannings 205-220
Good Fannings 180-200
Medium Fannings 110-120
Plain Fannings 75-90
Dust
Pekoe Dust not quoted
Red Dust 78-270
Dust 81-251
Churamoni Dust 150-270