Resumption Of Futures Trading In Jute Sought

Jute traders seek government intervention as raw jute prices crash. They also want immediate resumption of hedge trading in raw jute.

Perturbed over crash in raw jute prices for most of the grades of jute, traders have sought immediate intervention by the government to bring the present situation under control.

Not only the traders but farmers have also been affected by the fall in raw jute prices at this time of the season. Naren Dey, West Bengal agriculture minister is now in Delhi to discuss the situation with Chaturanan Misra, Union agriculture minister.

Raw jute prices, according to Khetulal Pugalia, vice-chairman, the Jute Balers Association (JBA), Calcutta, have crashed below minimum support price levels of the crop year 1996-97. The new support price for 1997-98 has been raised by Rs 73.50 per quintal for TD4 variety ex-Nadia district, West Bengal.

 

He said yesterday when the existing lower minimum support prices for 1996-97 crop year was being violated it would be impossible to enforce the minimum support prices for the 1997-98 crop year unless strong corrective measures were taken to change the bearish trend in the market.

Pugalia said that in order to tackle the present situation JBA suggested that the government should impose compulsory buying quotas for jute mills of a minimum physical stock equivalent to 10 weeks consumption, provide incentives for export of raw jute to reduce the glut in stocks and totally ban import of raw jute.

Jute Corporation of India (JCI) should also be asked to start its minimum support price (MSP) operations immediately so that the fall in raw jute prices could be arrested.

East India Jute and Hessian Exchange Ltd has opined that the erratic price behaviour in the raw jute trade could not be solved by the government through MSP operations by JCI.