Agri Business

Centre lifts jute price cap effective from May 20

Our Bureau | | Updated on: May 19, 2022

Against the total estimated requirement of around 23 lakh bales, IJMA has committed to supply only 10 lakh bales in RMS 2022-23

Move will help farmers, mills and jute MSME sector, says Textile Ministry

The Centre has lifted the price cap of ₹6,500 per quintal fixed for raw jute following information collected by the Jute Commissioner’s Office which revealed that the present market prices are ruling near the capped price, according to an official release.

“As the existing prices of raw jute are ruling around ₹6,500 per quintal, the government has taken a dynamic decision to lift the price capping with effect from May 20,” the release said.

The decision has been taken after the Calcutta High Court, on May 11, directed the Jute Commissioner to take steps so that mills can get the raw material at the notified rate of ₹6,500 per quintal, or review the price if the cap cannot be adhered to.

The Indian Jute Mills Association had moved the Calcutta High Court late last year against the ceiling rate for jute fixed at ₹6,500 per quintal on September 30, 2021, complaining that similar grade of jute was available at over ₹7,000 in the market.

A lower ceiling price for raw jute on paper hurts the millers which produce jute bags as they get lower prices for the bags from the government because in the input prices used in its calculation are lower than what they actually paid.

“It is expected that the cap removal will help the farmers, mills and jute MSME sector wherein over 7 lakh people are dependent on the jute trade in addition to about 40 lakh jute farmers.  The decreasing trend in prices will also benefit jute goods exports which constitute about 30 per cent of the industry’s turnover in value terms,” the release said.  

Published on May 19, 2022
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