Bangladesh tea price jumps on strong demand

DHAKA Tue Jan 1, 2013 6:52pm IST

DHAKA Jan 1 (Reuters) - Tea prices in Bangladesh jumped 13.36 percent at a weekly auction on Tuesday, after rising 7.3 percent at the previous session, on strong demand from local buyers, brokers said.

The average price of Bangladeshi tea rose to 293.26 taka($3.6) a kg against 258.70 taka per kg the previous week, an official at the country's largest tea broking firm, National Brokers Limited, said.

Around 1.65 million kg of tea were offered at Bangladesh's sole auction centre in Chittagong, with 3.67 percent unsold, compared with 1.75 percent unsold in the previous auction when 1.9 million kg was offered.

"Buyers were very active or practically all varieties on offer especially bright liquoring types which advanced substantially," National Brokers said in its market report.

Blenders dominated the market while loose tea buyers were mostly out-priced, it added.

Around 1.7 million kg will be offered at the next auction on Jan. 8.

Tea sold at the Chittagong auction is mostly bought by domestic buyers.

Last January Bangladesh's tax authority imposed a 25 percent duty on tea imports to safeguard the local industry.

The south Asian country produces 60 million kg of tea a year against demand of 56 million. Tea consumption there is rising by 4.5 percent annually, in line with steady economic growth.

Following are the results of the auction in Bangladesh taka per kg.

BROKENS Bold/Large Brokens 290.00 - 295.00 Medium Brokens 288.00 - 295.00 Small Brokens 290.00 - 297.00 Plain Brokens 240.00 - 270.00

FANNINGS Best Fannings 295.00 - 299.00 Good Fannings 293.00 - 298.00 Medium Fannings 288.00 - 292.00 Plain Fannings 245.00 - 265.00

DUST Pekoe Dust 275.00 - 318.00 Red Dust 275.00 - 320.00 Dust 285.00 - 318.00 Churamoni Dust 260.00 - 316.00 (Reporting by Ruma Paul; editing by Patrick Graham)