Prices of tea fell at Kenya's weekly auction, weighed down by low quality and oversupply but traders said on Tuesday prices could recover in coming weeks as output would drop off following dry weather in growing areas.
"There was large quantity. The buyers have had large quantities in previous sales and have not had immediate shipping opportunities," a trader at the Africa Tea Brokers (ATB) said.
"Prices won't fall. The crop is dropping fast in Malawi, Tanzania and Uganda is also stabilising."
The lion's share of tea on sale came from regional producing countries that have had heavy rainfall. Tea production peaks in wet and humid conditions.
Traders said demand by all traditional buyers, which was heavy at the start of the auction, fell towards the end as most had fulfilled their requirements.
"The tea was well absorbed despite declining demand toward the end," the ATB said.
Best Broken Pekoes Ones (BP1s) eased to $2.54-$2.63 per kg from $2.64-$2.70 per kg at last week's auction. Best Pekoes Fannings Ones (PF1s) fell to $1.89-$2.06 per kg from $1.97-$2.06 per kg at the previous auction.
A total of 111,100 packages or 7.2 million kg were offered at this week's auction, while another 112,760 packages or 7.3 million kg will be up for sale next week.