Jute Industry Faces Crisis As Prices Plummet Below MSP

New Delhi, Jun 26 (KNN) The jute industry is grappling with a severe crisis as prices of the golden fibre have fallen below Rs 5,000 per quintal, significantly lower than the Minimum Support Price (MSP) of Rs 5,335 per quintal set for the 2024-25 season.

This price drop comes despite projections of reduced production by the Expert Committee on Jute (ECJ).

Industry insiders attribute the crisis to a sharp reduction in orders for Gunny Burlap Textile (GBT) bags from the Food Corporation of India (FCI) and State Procuring Agencies (SPAs).

Om Prakash Soni of the Jute Balers Association told PTI on Tuesday, "The raw jute price has slumped. The price for the new raw jute season (June-July) ideally should have been Rs 5,800, but it has come down to Rs 5000 per quintal."

The situation has led to a significant downturn in mill operations, with many facilities operating at reduced capacity.

Soni added that the industry is facing unprecedented challenges, with orders halved and mills operating only two shifts for 4-5 days a week.

Sanjay Kajaria, Former Chairman, Indian Jute Mills Association, highlighted the severity of the situation. "Despite the ECJ's projections of a decline in production, raw jute is being sold at prices below Rs 5,000 per quintal, far below the MSP," he stated.

Kajaria emphasised the need for immediate government intervention to ensure farmers receive at least the MSP for their produce.

The crisis is expected to have far-reaching consequences. With a projected carry forward stock of 30 lakh bales, farmers may be forced to make distress sales of their new crop, which is due to hit the market within a month.

This situation threatens the livelihoods of an estimated 2.5-3 lakh mill workers in West Bengal alone.

Industry representatives are calling for urgent measures to address the crisis. Suggestions include strict enforcement of MSP, facilitation of direct procurement from farmers, increased orders from FCI and SPAs for GBT bags, and financial assistance for affected farmers and workers.

As the situation unfolds, the jute industry awaits decisive action from both state and central governments to mitigate the impact of this unprecedented crisis.

(KNN Bureau)