Bangladesh's tea production rose by nearly 17% in the first eight months of this year amid favourable rainfall, while auction prices remained higher despite increased supply.
Industry officials expect tea production to reach a new record this year if favourable weather conditions continue. They attribute the stronger auction prices to the government's minimum auction-price policy, which has helped maintain prices despite increased production, raising expectations of a better year for the tea sector.
Mohammed Moazzam Hossain, member (research and development) of the Bangladesh Tea Board (BTB), told The Business Standard that increased rainfall, favourable natural conditions, Tea Board monitoring and guidance from the Bangladesh Tea Research Institute (BTRI) had contributed to higher production.
"Rainfall has also been favourable this year. If these conditions continue, we expect tea production to reach 105 million kg by the end of the year. The previous record was 103 million kg," he said.
The previous record was set in 2023, when Bangladesh produced 102.92 million kg of tea.
Production and rainfall trends
According to the Bangladesh Tea Board, the country produced 5.79 crore kg of tea between January and August 2026, compared with 4.95 crore kg during the same period last year, marking a nearly 17% increase in production. This was also the highest January–August output recorded between 2021 and 2026.
Rainfall also increased substantially this year. According to the Bangladesh Meteorological Department, Sreemangal, one of the country's main tea-growing areas, received 2,620mm of rainfall between January and August, compared with 1,597mm during the same period in 2025, an increase of 64%.
Tea Board officials also cited improved monitoring and technical support as factors contributing to higher production.
"Previously, some tea was sold on the black market directly from factories. Some garden owners have been issued show-cause notices over this, and monitoring has been strengthened," Tea Board Member Mohammed Moazzam Hossain said.
Auction prices hold firm despite higher output
In previous years, higher tea production was accompanied by falling auction prices. However, prices have remained higher this year despite increased supply, following the government's introduction of minimum auction prices.
According to the Tea Board, 5.19 crore kg of tea was sold at 56 auctions for Tk1,463 crore between April and September this year, at an average price of Tk282 per kg.
Compared with the same period last year, auction sales volume increased by around 24%, while total sales value rose by nearly 49%.
Rising production costs and low auction prices had placed the tea industry under financial pressure over the past decade, leaving many estates struggling to repay loans, pay workers and invest in production.
Following a recommendation by the parliamentary standing committee on the commerce ministry in March 2024, the Tea Board introduced minimum prices on a trial basis for the first 20 auctions of the 2024-25 season. The policy was expanded nationwide in May 2025.
According to the Tea Board, annual tea auction sales value increased by nearly Tk562 crore between the 2023-24 and 2025-26 auction years, alongside a rise in average prices.
Tahsin Ahmed Choudhury, chief operating officer of Finlay Tea Company, told TBS, "I don't think production will increase substantially this year. However, with minimum auction prices in place, there is little risk of a sharp fall in tea prices."
Industry expects better returns
Bangladesh has 172 registered tea estates, while small growers also cultivate tea in the northern region and two hill districts, according to the Tea Board.
Moulvibazar accounted for 47% of national tea production in 2025, while five northern districts, led by Panchagarh, contributed around 21%.
Tea Board Member Mohammad Moazzam Hossain said many tea estates had faced financial difficulties for years because they were selling tea below production costs.
"With tea prices increasing, gardens are becoming operational again, and the industry is recovering. We do not expect a significant decline in prices. Domestic demand for tea is also increasing," he said.