Tea prices fell sharply at Bangladesh’s weekly auction due to large supplies of inferior-quality leaf.
Bangladeshi tea fetched an average price of 200.01 taka ($2.80) per kg at Tuesday’s auction, compared with a revised price of 215.01 taka in the previous sale, National Brokers said.
Prices dropped sharply as buyers sought huge discounts for poor-quality tea, of which there was huge supply, a senior official at National Brokers said.
About 38 per cent of the 2.7 million kg offered at the sole auction centre in Chittagong was unsold, compared with 35 per cent unsold of the 2.5 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 185-190
Small Brokens 190-200
Plain Brokens 145-165
Best Fannings 210-215
Good Fannings 200-210
Medium Fannings 185-195
Plain Fannings 165-175
Pekoe Dust not quoted
Red Dust 172-237
Churamoni Dust 164-262