NAIROBI (Reuters) - The prices of best Kenyan Broken Pekoe Ones (BP1s) came off a record high at this week’s auction to an average $4.94 per kg compared with $5.02 at the previous sale, brokers said on Monday.
Tea prices have been rising to record highs since mid-August on concerns production in Kenya, the world’s biggest exporter of black tea, may fall significantly due to bad weather.
“Brighter BP1s met an easier enquiry by $0.05 to $0.14 but a few improved invoices gained up to $0.04 to $0.08 with mediums a weak feature and were discounted by $0.03 to $0.36 and many lines remained unsold,” the Africa Tea Brokers (ATB) said.
There was good but irregular demand for the 86,729 packages, or 5.5 million kg. About a quarter of what was on sale, especially medium BP1s, remained unsold, ATB said in a report.
Kenya’s output dropped 11 percent in the first seven months of 2009 compared with the same period in the previous year due to a drought in the region. Some growing areas east of the Rift Valley were worst affected.
But meteorologists forecast that seasonal rains that started in October would be heavier than usual due to the El Nino weather phenomenon. Many areas of the east African grower have reported heavy rains.
The average price for Best BP1s was $5.02 per kg from the previous week’s record of $4.47 per kg and another high of $4.31 per kg at the sale before that.
Top Pekoe Fanning Ones (PF1s) fetched higher prices than last week at between $3.72 and 3.45 per kg compared with $3.58-$3.34 week.
The ATB said Russia, Egyptian Packers and the government sector had been less active at Monday’s sale.
“Afghanistan re-entered the market forcefully and there was more activity from the UK and Bazaar while Pakistan Packers were quite active,” the report said.