Tea prices on the rise in local markets

Price of tea has risen in the local markets because of lower production and higher demand.

According to the Bangladesh Tea Board (BTB), the annual tea production in 2020 was set at 70.70 million kilograms (7.70 crore kgs). Whereas, 30. 39 millions of kilograms (3.39 crore kgs) have been produced so far till July. 

In 2019, the country's tea production was 96.7 million kilogram (9.6 crore kg), exceeding the annual target by 16 million kg (1.6 crore kg).

Unfavourable weather including excessive rainfall and drought has caused a slump in tea production this year, contributing to the rise in prices, said tea growers and officials from tea processing factories.  

Besides, tea consumption soared remarkably given that the tea stalls, restaurants and hotels were reopened in the countrywide after the shutdown induced by Covid-19.

The country’s annual tea consumption demand was around 95.2 million kilograms last year. There are currently 162 tea estates in the country, of which 92 are located in Moulvibazar, according to the sources of BTB.

Tea produced at the local tea gardens is sold at two auction centres in Chittagong and Moulvibazar’s Sreemangal Upazila. Prices of tea have gone up at these auction centres causing an upward trend in the price in the local market.

Md Selim, proprietor of Selim Tea House located at Sreemangal’s Station Road, said: “Inferior quality tea was being sold Tk 170 a kg a few days ago, and it has now risen to Tk220 a kg. Price will increase further in local markets. Per kg clone tea (small grains) is being sold at Tk350 to 380 while per kg BT-2 grade tea is being sold for Tk400 to Tk450 in the local markets of Srimangal.

“Besides, high quality tea BT Gold is being sold Tk600/650 a kg and green tea is Tk650/700 a kg,” the trader added.

Selim Reza, manager of Zareen Tea Estate that is home to the renowned Ispahani tea, said that due to the drought, tea production has fallen by 50% in March alone. 

“Many tea gardens do not have irrigation systems. Despite modern irrigation, my garden is likely to see a 12% drop in tea production by the end of the year,” he added.

Pijush Kanti Nahar, manager of Nahar Tea Garden in Sreemangal, said: “Tea production has declined in India due to the closure of gardens during Covid-19 pandemic. For this reason, tea smuggling as well as import from India to Bangladesh has stopped, causing a rise in the price of tea in our local markets.”

GM Shiblee, chairperson of tea garden owners' association Bangladesh Cha Sangsad in Sylhet, said: “Tea production is less than half of the target this year.  The main reason for this is that there was rain on 25 days out of 30 days in June alone. There was also no adequate sunlight suitable for tea cultivation.

“Tea plantations are hampered if it rains in the day. Tea plants cannot produce food for themselves through photosynthesis if the weather remains cloudy. It hampers the growth of tea buds.”