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Mills facing severe raw jute crisis

 MPost |  2015-11-04 01:06:34.0  |  Kolkata

Jute mills in the country are facing severe raw jute crisis due to alleged hoarding of the commodity, leading to closure of units.

Some 24 jute mill owners in West Bengal met to review the crisis and made representation to the Centre and state governments seeking their intervention into the matter.

The mill owners have sent representations to the Jute Commissioner and West Bengal labour minister Malay Ghatak. 

“We are facing grave crisis of artificial shortage of raw jute coupled with all time high prices in the history of the jute industry. Prices have jumped by at least 40 per cent making production unviable for the mills,” jute mill owner and Indian Jute Mills Association former chairman Sanjay Kajaria said. 

According to him, raw jute market has taken mills to hostage and there were no sellers with a monopolistic situation. Kajaria said already five mills have closed, more would follow and the industry would be in doldrums unless the government takes urgent measures.

“Mills have already begun to shut down and if no action is taken, more mills will shut down as hoarders have taken over the industry,” the mill owners alleged.

Some two lakh workers were depended on jute mills.

The letter sent to the minister said “The foul play is such that some mills and traders are hand-in-glove with the hoarding community and are manipulating the market by holding stock, thereby increasing the raw jute price artificially and even restricting the supply.”  Under such circumstances, the mills were not in a position to keep their commitments of compulsory supply of jute bags to the government under the Jute Packaging Materials (Compulsory use in Packaging Commodities) Act, 1987 due to non-availability of raw jute, the letter said.

“Last year the production was 72 lakh bales, but raw jute suppliers are claiming this year production will be 60-65 lakh bales. Even then there is no reason for shortage at this point of time,” Kajaria said.

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