Tea prices up on demand for good leaf

Tea prices in Bangladesh gained at the weekly auction on Tuesday due to strong demand from local buyers for quality leaf ahead of the Eid holidays and tight supplies.

Bangladeshi tea fetched an average of 192.13 taka ($2.50) per kg at the auction, against 190.35 taka at the previous sale, an official at National Brokers Ltd said.

Around 1.67 million kg was offered at the auction centre in Chittagong, with 24 percent remaining unsold. At the previous auction, nearly 1.8 million kg was offered, of which 28 percent went unsold.

“There was strong demand from local buyers for quality tea ahead of Eid vacation,” the official said.

The next auction will take place on Aug. 5 after a week-long gap to celebrate the Muslim festival Eid al-fitr, which marks the end of Ramadan.

Bangladesh’s tea production in 2013 rose 1.6 percent from a year earlier to a record 63.5 million kg due to favourable weather, but was still short of the domestic consumption of about 65 million kg.

In April this year, the Bangladeshi tax authority trebled regulatory duty to 15 percent on imports of tea to discourage overseas buying amid a drop in local prices due to ample supplies.

-Reuters