Tea prices increase by Tk 30 per kg in high season
Tea prices generally fall in the country’s markets in June-October, during the peak production season, but this year prices have increased.
Tea prices have risen by Tk 30-40 per kg over the past two weeks at auction and market levels, according to industry insiders, as leaf picking in tea gardens across the country remained closed. for three consecutive weeks last month due to the movement of workers demanding higher wages. .
The average tea price at the 17th auction held in Chattogram on September 5 was over Tk 220 per kg. In the previous auction on August 29, the average price was 210 Tk. In the previous 10th to 15th auction, prices ranged between TK 190 and TK 200, auction sources said.
About 25.54 lakh kg of tea went up for auction in the 17th auction, which was 5.15 lakh kg less than the previous year’s auction. The brokerages said a lower amount of tea will also be available for sale in upcoming auctions.
Previously, on average, about 60-65% of tea brought to auction was usually sold, but about 80-85% of tea has been sold in recent auctions. This increase in market demand for tea triggered the recent price hike, according to wholesalers and retailers.
Coarse tea prices in different gardens across the country including Panchagarh have increased by Tk 20 per kg. In contrast, prices of other tea varieties, including clone tea, increased by around Tk 40 per kg.
Mohammad Yusuf, former vice president of the Bangladesh Tea Traders Association, told The Business Standard (TBS): “If supply decreases relative to demand, the price will naturally be affected. Although the production of tea in the country has increased every year, it is still small compared to the population. In addition, the recent strike disrupted production. Low rainfall this season has also affected tea production.
According to sources present at the auction, the companies said they would supply more tea than previous auctions during this year’s peak season, which they could not deliver. The quality was also relatively lower.
Additionally, buyers have shown more interest in sourcing good quality tea at recent auctions, anticipating that the effects of the labor strike may last longer.
Tea garden owners have said three-inch-sized tea leaves are best for producing quality tea. The leaves are picked every 7 to 10 days. But no leaves were picked from the gardens for three weeks during the workers’ protest, leaving leaves to grow up to 6 to 15 inches. As a result, the quality of these leaves has declined.
Md Karim, the owner of Planters Brokers, said the supply of tea in the market is normal at the moment and the average price of tea has increased slightly in recent auctions. The recent labor movement may have an impact here.
He also said garden owners are not benefiting as much from the price hike as retailers and wholesalers. “There may be hoarding issues here,” he said.
Traders said more than 95% of the country’s total tea is auctioned at Chattogram. In the last auctions, 85-90% of the tea was bought by the buying houses. That is, only 10-15% of the tea was returned to the auction.
Buyers are rushing to increase their purchases for fear of a further reduction in tea supply at upcoming auctions, they said.
Md Abdur Rahman, the owner of Pabna Tea House in Chattogram, said: “The best quality tea is provided from the garden in the middle of the year. But in the last two auctions, the price of tea has gone up. good clone tea increased the most.”
Tea garden workers across the country have gone on strike at their workplaces demanding higher daily wages for 19 days from August 9. On August 28, they returned to work after the Prime Minister set their daily salary at Tk 170.