Jute Prices Dip 40% Within A Month

Cheap imports and subsequent insecurity in the market has led to a decline in raw jute prices by almost 40 per cent, in less than a month. Raw jute prices which closed at Rs 1,600 on July 9 declined to Rs 1,290 within a week and closed at Rs 985 yesterday.

Sanjay Kajaria, chairman of the Indian Jute Mills Association (IJMA) said, the dilution of Jute Packaging Materials Act (JPMA) allowing use of cheap imports was the primary reason behind this fall in prices. During April-June alone, around 14,000 tonne of jute goods from Bangladesh was imported. Last year 53,000 tonne of jute goods was imported from Bangaldesh.

Kajaria said, the effect of JPMA dilution was inevitable. In 1999, dilution had had a dramatic impact on raw jute prices. In keeping with the ruling of the Gujarat High Court order, mandatory jute packaging in foodgrains and sugar has been diluted by 10 per cent and in urea by 5 per cent. The Cabinet Committee for Economic Affairs (CCEA) would meet on August 10 for review of JPMA.