Govt Demand Keeps Prices Firm

Sacking futures' prices at the East India Jute & Hessian Exchange closed at Rs 2236.50 for 100 bags on the last trading day of last week, after touching a high of Rs 2241.50.

The present contract will close of February 23, 2002. The November contract closed at Rs 2,275 on November 25. Sources at the exchange said the main reason behind the firm prices is good demand from the government and firm raw jute prices. In August, sacking prices were around Rs 2,180.

Forward prices for basic varieties were around Rs 2,298 and for alternate varieties, Rs 2,617.

Raw jute prices increased significantly to around the Rs 1,100 level. However, the industry expects a substantial drop in prices if the industry-wide strike takes place in January.

Meanwhile, at a meeting held on December 1, 2001, the joint secretary, ministry of textiles said: "In case of shortage of jute bags for packing of foodgrains and sugar, the textiles ministry will have to resort to dilution of Jute Packaging Materials Act (Jpma)". A final decision would be taken after assessing the situation in the last week of December.

The industry would be in a position to supply four lakh bales of BT bags against a total demand of seven lakh bales for the rabi season.