May 14, 2014 / 11:40 AM / 3 years ago

Bangladesh tea prices up on arrival of quality leaf

DHAKA, May 14 (Reuters) - Tea prices in Bangladesh rose on
Wednesday at the first auction of the new season, on arrival of
fresh and good quality leaf, brokers said.
    Bangladeshi tea fetched an average of 194.27 taka ($2.5) per
kg at the auction, up from 68.03 taka at the previous sale after
the auction season, typically to end-March, had been extended
through April, an official from National Brokers Limited said.
    Demand was good for good quality tea and major buyers were
back to the market on the arrival of fresh leaf at the first
auction of the new season, the official said.
    Sales volume also rose this week although a good quantity of
tea remained unsold, he added.
    More than 1 million kg was offered at the sole auction
centre in Chittagong, and 37 percent remained unsold. At the
previous auction on April 29, around 800,000 kg was offered, of
which nearly 47 percent went unsold.
    Bangladeshi buyers have been importing tea in bulk from
neighbouring India, contributing to a glut in the domestic
market and reducing demand at the auction, industry sources
said.
    Earlier this month, however, the Bangladeshi tax authority
trebled regulatory duties to 15 percent on imports of tea to
discourage overseas buying as local prices have fallen on ample
supplies. 
    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.
    That still fell short of domestic consumption of about 65
million kg. Bangladesh has moved from becoming a net exporter to
a net importer of tea as consumption has risen.

 (Reporting by Ruma Paul, editing by William Hardy)

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