Bangladesh tea prices rises on strong winter demand

DHAKA: Tea prices in Bangladesh rose at the weekly auction for the second time in a row, thanks to strong winter demand and tight supplies.

Bangladeshi tea fetched an average price of 238.25 taka ($2.80) per kg at the auction held on Tuesday, compared with a revised price of 236.80 taka at the previous sale, National Brokers said.

There was strong demand as buyers wanted to stock up for the winter, while supplies were lower than last week, a National Brokers official said.

Demand for tea in Bangladesh usually rises in winter.

However, about 19 percent of the 2.27 million kg offered at the sole auction centre in Chittagong was unsold, compared with 15 percent unsold of the 2.62 million kg offered in the previous auction.

Bangladesh's tea production jumped nearly 27 percent in 2016 to a record 85 million kg, helped by favourable weather conditions, making imports a choice not a necessity.

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 in line with economic growth.