Tea auction begins May 13 amid Covid-19 crisis

The tea auction for the new year will start on May 13 after two occasions were postponed due to the outbreak of the novel coronavirus.

The Bangladesh Tea Board has not released the full schedule for the auction but has set two dates for Chattogram. No date has been finalised for Srimangal as yet.

As per the tea board schedule for 2020-21, the first auction will be held on May 13 and the second on May 19.

A circular signed by the tea board's Acting Deputy Director (Trade) Muhammad Madhul Kabir Chowdhury provided some instructions about the auction.

According to the tea board, the new year's tea auction will be held in Agrabad of Chattogram.

In order to prevent Covid-19 from spreading, auction participants will have to sit at a distance of seven feet to maintain social distancing. If space is not available at the current centre in Agrabad, the auction will have to be moved to a larger hall.

The notification includes instructions for following health rules at auction centres, broker houses and warehouses. The directive also mentions that only essential manpower should be present during the auction.

Kula Pradip Chakma, secretary to the Bangladesh Tea Board, said, "During the novel coronavirus situation, we have finalised two dates for the 2020-21 auction year for Chattogram.

"When the office opens after the public holiday, the full schedule will be set. No date has been fixed yet for the auction in Srimangal."

According to tea board sources, four auctions are held in Chattogram and Srimangal every month. Of these, one is held in Srimangal.

In a year, usually 45 auctions are held unless the tea board increases the number for special circumstances.

Due to the Covid-19 crisis, the 47th and 46th auctions for the last year, 2019-20, were postponed respectively on March 24 and March 31.

Meanwhile, the average tea price declined significantly towards the end of the last auction year. In the just-concluded 2019-20 auction year, the average price fell below Tk177 per kilogramme – which was Tk262.96 per kilogramme in 2018-19.

As two auctions were not held, nine lakh kilogrammes of tea remained unsold to various broker houses. However, the tea board decided to allow the broker houses to sell tea at their outlets – without auctions – until a new auction is held.

Sujit Bhattacharya, senior manager of Produce Brokers – a tea auction house, said the average price of tea at the end of the last auction year was Tk175-180 per kilogramme.

"However, it is not possible to say what the average price will be this year. We expect the average price of last year will continue in the new auction year."

According to the Bangladesh Tea Board, there are 167 tea gardens in Bangladesh. Of them, 22 tea gardens are in Chattogram district, one in Rangamati and one in Bandarban. The rest are in Sylhet, Srimangal and other districts.

Owners, after producing tea from the garden, send it to the tea board's registered brokers. The board then checks its quality and determines the prices and grades in lots. The grade and suggested price of the tea are determined in the catalogue prepared by the brokers.

The registered buyers go to the auction every week and participate in the bidding. In this case, the tea, sent by the garden owners, is sold at the auction at a price higher or lower than the price fixed in the catalogue.

In 2019, the highest tea production of the history of the industry in Bangladesh was 96.07 million kilogrammes. From January to March 2020, 1.83 million kilogrammes of tea were produced.

The average price of tea sold at the first auction of 2019-20 was around Tk250 per kilogramme.