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Tuesday, 29 January, 2002, 14:20 GMT
Bangladesh tea exports fall
Tea garden in Bangladesh
Local tea consumption rose in 2001
Tea exports from Bangladesh fell by more than a quarter last year as the country's crop lost out to tea from Africa and other South Asian nations, the industry's regulator said.

Bangladesh faced strong competition from good quality tea at cheaper prices from Kenya, Malawi, India and Sri Lanka.

Fall in exports is a matter for concern for the country's foreign exchange reserve, but it never threatens the tea industry

Rafray Nizam

Export sales dropped 28.73% in 2001, even though Bangladesh produced nearly 5% more tea than the previous year, according to the Tea Board of Bangladesh.

Bangladesh sold 12.9 million kilograms of tea abroad last year.

Local purchasing power

The south Asian nation's 158 tea estates boosted their crop to 55.1 million kilograms last year from 52.6 million in 2000.

But exports to Poland and Russia dried up and Pakistan bought considerably less Bangladeshi tea than it had in 2000, according to exporters.

African woman picking tea
African tea exporters did better than Bangladesh

The slide in tea exports is unlikely to harm the industry because it is bolstered by the strength of local demand, according to Rafay Nizam of tea merchant National Brokers.

"Fall in exports is a matter for concern for the country's foreign exchange reserve, but it never threatens the tea industry because of local demand which is growing stronger" due to increased purchasing power, he said.

Worldwide, tea prices fell in 2001 because of a rise in output.

Chittagong contest

But the burgeoning Bangladeshi local market contributed to relatively high prices at the country's weekly Chittagong tea auction and hence the fall in exports.

"Local buyers compete strongly with overseas buyers" at the Chittagong auctions because of rising local purchasing power," said Mohammad Idris of the HRC Syndicate of exporters.

Chittagong is the sole auction centre for Bangladesh's tightly regulated tea trade, though buyers can purchase tea direct from growers who have export licenses.

World tea production rose to 3.7 million tonnes last year from 3 million tonnes in 2000, analysts said.

See also:

15 Jan 02 | Business
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16 Jan 02 | South Asia
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04 Jan 02 | Business
Bangladeshi jute bag demand soars
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Water poisoning in Bangladesh
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