Tea prices usually go down during peak harvest season from June-October, but this year it is surprisingly going up.
According to industry insiders, tea prices increased by Tk30-40 per kg in the last two weeks during auction and in the market as harvest was suspended for three weeks due to workers' strike for higher pay.
The average price of tea in the 17th auction held in Chittagong on September 5 was over Tk220 per kg.
In the previous auction on 29 August, the average price was Tk210.
In the previous 10th to 15th auctions, the prices ranged between Tk190 and TK200, said auction sources.
Around 2.55 million kg of tea was brought for sale in the 17th auction, which was 515,000 kg less than the auction a year earlier.
Brokers said a lower amount of tea will be available for sale in the next auctions too.
Earlier, on average, around 60%-65% of tea brought at the auction was sold usually but around 80%-85% of tea has been sold in recent auctions.
This surge in demand for tea in the market has triggered the recent price hike, according to wholesalers and retailers.
The prices of coarse tea in different gardens of the country, including in Panchagarh, have increased by Tk20 per kg.
On the other hand, the prices of other varieties of tea, including clone tea, have increased by around Tk40 per kg.
According to sources at the auction, the companies announced to supply more tea than the previous auctions in the peak season this year which they could not deliver. The quality was also comparatively lower.
Moreover, buyers have shown more interest in procuring good quality tea from the recent auctions anticipating that the impact of the labour strike may last longer.
Tea garden owners said that tea leaves with a size of three inches are best for producing quality tea. The leaves are plucked every seven to 10 days.
But no leaves were plucked in the gardens for three weeks during the labour protest, leaving the leaves to grow up to six to 15 inches.
As a result, the quality of these leaves declined.
Traders said more than 95% of the country's total tea is sold in the auction in Chittagong.
In the last few auctions, 85%-90% of the tea has been bought by the buying houses. That is, only 10%-15% of the tea has been returned from the auctions.
Buyers are racing to increase their procurement due to fear of a further reduction in tea supply in the upcoming auctions, they said.
Tea garden workers in the country carried out a strike in their workplaces demanding higher daily wages for 19 days from August 9.
On August 28, they returned to work after the prime minister fixed their daily wages to Tk170.