The Indian Jute Mills Association (IJMA) said the raw jute price ceiling is going to be counterproductive for jute cultivation and sought the intervention of West Bengal Chief Minister Mamata Banerjee to take up the matter with the Centre to review the decision by the Union government.
The jute mills’ lobby body, seeking to suppress or at least review the raw jute price ceiling level, opined that the Jute Corporation of India may be activated to procure jute from farmers and supply the same to the industry under linkage of jute bag supply orders. The jute regulator, the Jute Commissioner’s office, has imposed a price ceiling of Rs. 6,500 per quintal on the raw jute trade in order to ensure a supply of raw material to the mills at a fair price.
However, mill sources claim that putting pressure on the government to reconsider the move will have a negative impact, and raw jute hoarding will worsen.
The jute farmer will be disincentivized from cultivating raw jute next year with these regulations in place. West Bengal jute farmers will be worse off than their counterparts in Bangladesh. Indirectly, this will result in the growth of the Bangladesh industry at the cost of India, ” IJMA said.
This policy of fixing a ceiling price when jute is still held at the farm level will never allow the jute industry to grow and meet the increased demand for jute bags. We request you to take up the matter with the Central government for review of the price ceiling order by the Jute Commissioner. “
IJMA claimed a similar grade of jute was priced at Rs. 7,000 per quintal and said the industry has the capacity to meet the demand provided raw material is available and prices are commensurate with the rate offered for jute bags for packaging food grains.
Officials of the Jute Commissioner’s Office said price ceilings and stock limits had been imposed for the benefit of the jute mills in terms of price of fibre and supply.
The issue of availability and the resultant affordability of raw jute remains the biggest bottleneck for growth in the jute sector. For two consecutive years, we have been faced with a short supply of raw materials. The years 2020–21 witnessed a record low output of raw jute, at only 58 lakh bales, as farmers and farm labour had been hit by the COVID-19 pandemic, ” IJMA claimed.
“Availability of just 85 lakh bales is insufficient for the industry’s requirements.” By our calculations, 100 lakh bales of jute crop are required by the industry to cater to the increased requirement of bags in the food grain sector, ” IJMA said.