Raw jute shortage likely to hit packaging of Rabi crops

In a bid to prevent hoarding of the raw jute and improve supplies to mills, the industry regulator had asked stockists to hold not more than 500 quintals of raw jute from November 17.

Kolkata: With continuous disruptions in raw jute supplies to mills, manufacturing of gunny bags has been severely hit, which could have an adverse impact on the availability of packaging material for Rabi crops, industry sources said on Tuesday.

According to an industry estimate, quantity of raw jute being hoarded could be around 20 lakh bales, and the supplies to mills are at about 50 per cent as against their requirements, they said.

Some units have stopped operations as they could not get adequate raw material at a fair price, a section of jute mill owners claimed.

In a bid to prevent hoarding of the commodity and improve supplies to mills, the industry regulator had asked stockists to hold not more than 500 quintals of raw jute from November 17.

The order came at a time when the price of the commodity soared to over Rs 6,000 per quintal, impacting the manufacturing of bags.

Traders, however, had moved the Calcutta High Court, challenging the raw jute stock limit order.

Recently, the jute regulator has been asked by the court to consider an extension of time for implementation of the 500-quintal stock limit order, if applied by the stockists.

The court, however, said the Jute Commissioner's office would be free to take action after the expiry of the extension period.

"According to the court order, Monday was the last day for submitting applications. Some raw jute traders have applied for an extension of time so that they can abide by the control order. We are looking into these applications," Jute Commissioner Moloy Chakraborty told PTI.

Despite the JC's order and requests from the West Bengal government, the situation had not improved much with raw jute price remaining at close to Rs 6,000 a qunital, the industry sources said.

During a meeting of Group of Ministers on Monday, the West Bengal government hinted that actions could be taken against the traders if the supply is not streamlined, they said.

The meeting was chaired by state finance minister Amit Mitra.

Based on the state agriculture department's analysis, the government will fix a fair price for raw jute at the next meeting slated to be held by end of this month.

Compared to an estimated demand of 25 lakh bales of jute sacks for packaging of Rabi crops, millers have committed to supply 11 lakh bales.

(PTI)