Jute commissioner fixes stock holding limit for mills

Worried over spiraling prices of raw jute, the jute commissioner has issued an order, fixing a stock holding limit of two months for the mills.

The mills that stock jute over two months of their consumption requirement would face action under clause 9 of the order, read with Section 7 of the Essential Commodities Act.

"In case you have already built up stocks of raw jute in your mill and upcountry godowns including stocks in pipeline in excess of your two months' requirement, you shall reduce such stocks to two months consumption level in course of normal process of manufacture in your mill. You shall totally suspend fresh purchases of raw jute from all sources either directly or through your agent or third parties until the above mentioned stocks come down to below your two months consumption level", the order stated.

Prices of raw jute have shot up abnormally and are hovering around Rs 46,000 a tonne. Hoarding of raw jute and manipulative practices adopted by some millers and traders are believed to have escalated prices.

"The jute commissioner's order will spell relief for the industry. Price hike in raw jute has been unprecedented, mainly fuelled by hoarding. The latest order will help curb prices," said owner of a leading jute mill.

The order would not be applicable to delivery of raw jute by Jute Corporation of India (JCI), provided the office of the jute commissioner is immediately informed for verification. Besides, limits of raw jute would not include raw jute of specified qualities, which will be required to meet export commitments of jute goods, subject to submission of documentary evidence of exports and verification and acceptance of such documents by the office of the jute commissioner.