The Hindu Business Line : Raw jute prices hover below MSP

THE ongoing jute year (July-June) is about to enter its last quarter but any sort of raw jute crisis is ruled out by agriculturists and traders of raw jute.

Sources in the raw jute trading circles said that there is enough stock to meet the demand of the jute mills. They are even optimistic that there will be a huge carryover for the next year.

However, the concerning factor is the price of raw jute. According to the official quotation from the Jute Balers' Association, prices are hovering well below the minimum support price.

Regarding the raw jute stock, sources said the total production of raw jute during the year 2003-04 was 80 lakh bales. Then there was a carryover of around 28 lakh bales from the previous year.

Import of raw jute from Bangladesh during 2003-04 was to the tune of 8 lakh bales. So the total availability of the golden fibre was around 116 lakh bales for the whole year.

Industry sources said the total consumption of raw jute, taking into account both the organised mills and the unorganised sector, is approximately 100 lakh bales. So, there is likely to be a carry forward of 16 lakh bales for the next year, 2004-05.

Presence of huge raw jute stocks is nothing new for the industry. "Earlier there used to be a raw jute crisis during the fag end of the jute year but for the last four or five years there are no reports of any such shortage. This year there will be no difference", sources told Business Line.

Raw jute traders are, however, aggrieved about the prices of the golden fibre. According to Thursday's market quotation, the price of TD-4 (the standard variant) is Rs 880 per quintal at the district level. In Kolkata, it is available at Rs 980 per quintal.

"The Union Government announced MSP for TD-4 at the district level is Rs 933 per quintal and in the city it is Rs 1033 per quintal. The current levels are not remunerative either for the farmer or for the trader," sources said.

It was also learnt that the raw jute prices were worse a fortnight back when the price of the TD-4 variant dropped to Rs 810 per quintal.

Traders threaten closure now

THE jute industry might have just come out of 14-day industry strike but it is again facing a closure threat. Last time, it was the workers, now it is the turn of the raw jute traders.

It was learnt from reliable sources that most of the jute mills have not cleared the payments of the raw jute suppliers. "It has reached to such levels that it is no longer sustainable for us", sources said.

Members of West Bengal Jute Sellers Association will be meeting next week to consider a total stoppage of raw jute supplies to all the jute mills. "We are not selecting any particular mill as almost every mill is a defaulter", sources said.

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