Higher auction price fetches Tk562cr more for tea sector in 2 years
Introduced to protect growers from rising production costs and falling prices, minimum auction pricing has boosted tea sector earnings by more than Tk560 crore in two years, Tea Board data show.
Highlights:
- Average auction price up Tk74.26/kg in two years
- Tea growers and estates earned Tk562 crore more than two years ago
- Policy intervention through minimum auction pricing credited for turnaround
- Despite lower volumes sold than 2023-24, revenue reached a record level
Tea estates and small growers earned more than Tk560 crore in additional income over the past two years after the government introduced minimum auction prices, with the average auction price of tea rising by more than Tk74 per kg during the period.
Bangladesh Tea Board data show that the average auction price increased to Tk245.50 per kg in the 2025-26 auction year, up from Tk171.24 per kg in 2023-24. During the same period, total auction income rose from Tk1,664.21 crore to Tk2,226 crore, an increase of nearly Tk562 crore.
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The measure was first introduced on a trial basis in 20 auctions following a meeting of the parliamentary standing committee on the commerce ministry in March 2024. After positive results, the government expanded the policy nationwide in May last year.
Stakeholders said the move came as tea gardens struggled with rising labour wages and higher costs of gas, fertiliser, electricity, coal and other inputs. Prolonged price declines had left many estates unable to repay loans, pay workers or invest in production.
To protect growers, the government fixed the minimum auction price for tea from Sylhet and Chattogram at Tk245 per kg, broadly in line with the industry's estimated cost of production. The minimum price for North Bengal's bought-leaf tea was set at Tk170 per kg.
According to Tea Board auction data, 97.186 million kg of tea was sold in 2023-24 at an average price of Tk171.24 per kg, generating Tk1,664.21 crore in income. In 2024-25, sales fell to 87.722 million kg, but higher prices pushed income to Tk1,776 crore.
In 2025-26, auction sales rose slightly to 90.672 million kg, while the average price climbed to Tk245.50 per kg, lifting total earnings to a record Tk2,226 crore.
Industry representatives said the policy has provided much-needed relief to the sector. Kazi Arfan Ullah, manager of Neptune Tea Garden of MM Ispahani Ltd, said the minimum pricing mechanism helped ensure better returns and supported the industry's survival during a difficult period.
Bangladesh currently has 172 tea estates and a growing smallholder tea sector, particularly in Panchagarh, now the country's second-largest tea-producing region. In 2025, Moulvibazar accounted for 47% of national tea production, followed by Panchagarh with 21%, Habiganj with 16% and Chattogram with 11%.
Auction prices also improved significantly in Panchagarh, where small growers once sold tea for as little as Tk100-Tk150 per kg because of quality concerns and delayed leaf processing. In the latest auction year, tea from the region sold for between Tk241.93 and Tk246.63 per kg, averaging Tk246.13 per kg.
The issue was discussed at the 6th National Tea Day programme in Sreemangal on Saturday, where leading tea estates, exporters and small growers were honoured for contributions to production, quality improvement, exports and workers' welfare
