Tea prices up on tight supplies

Tea prices edged higher for a second straight week at the weekly auction held in Chittagong Tuesday amid tight supplies and strong demand for quality leaf, reports Reuters.

Bangladeshi tea fetched an average 187.93 taka ($2.4) per kg at the 19th auction of the current marketing season, slightly up from 185.81 taka at the previous week's sale when the prices snapped seven-week losing streak, an executive with National Brokers said.

There was huge demand for quality tea, while volume dropped again this week compared with last week, helping prices to perk up, the executive said.

About 1.93 million kg was offered at the sole auction centre in Chittagong, of which 6.5 per cent was unsold. In the previous auction, about 10 percent of the 2.17 million kg offered went unsold.

The national budget for the 2015/16 fiscal year that started in July raised the regulatory duty on tea imports by 5.0 per cent to discourage overseas buying.

Tea prices fell sharply in the last marketing season on poor demand from local buyers as business sentiment was hit by renewed political unrest early this year that left more than 120 people dead and disrupted supplies.