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Jute
Introduction & Highlights The jute sector has been playing an important role in the economy of the country in general and the eastern region in particular. The socio-economic significance of jute sector stems not merely from the contribution it makes to the national exchequer as earnings from exports and through taxes and levies, but also from the sizeable employment it provides in agriculture and industries. About four million farmers, most of them small and marginal, are engaged in the cultivation of jute and mesta and about two lakh workers are employed in the jute industry. Apart from this, the jute sector has also provided indirect employment to a considerable number of people. The first seven months of 1999-2000 have turned out to be by and large favourable for the jute sector. With a moderate crop size currently estimated by Jute Advisory Board at around 78 lakh bales, a carryover stock of around 24 lakh bales from 1998-99 season and an estimated import of 5 lakh bales, the raw jute supply position has become comfortable. As a result, the industry has faced no problem in procuring raw jute for uninterrupted production of jute goods to cope with the demand in the domestic market. The jute goods market continued to display mixed trends with prices of all goods showing fluctuations. The market is expected to rule steady in the coming months, as all foodgrains procuring agencies have finalised their advance requirement of a massive quantity of 5.6 lakh bales of B.Twill bags for the forthcoming Rabi season and began procuring such bags from Oct`99 coupled with generation of demand from sugar sector. The raw jute prices continued to rule well above the minimum support level and farmers have received better prices for their produce in the post harvest period. India has rejoined
the International Jute Organisation w.e.f. 23rd December, 1999. India’s
re-entry into the International Jute Organisation will strengthen India’s
efforts in increasing the market size for its jute products particularly
food grade jute bags and diversified jute products in the international
market. India is also expected to play a major role in the renegotiation
of International Agreement on Jute and Jute Products 1989.
Production of Jute goods Production of jute goods during 1998-99 (April-March) decreased by 4.9% to 15.96 lakh tonnes as against 16.78 lakh tonnes in 1997-98. However, this fall in production was attributable to lower production of Hessian, Carpet Backing Cloth (CBC) and other goods due to sluggish demand. Production during
1999-2000 (April-Oct) also recorded a marginal decline by 0.3% to reach
9.33 lakh tonnes from 9.36 lakh tonnes during the same period of last year.
This fall in production was due mainly to lesser demand of jute goods from
various end-user sectors. If the current trend of production is maintained,
production of jute goods is likely to touch around 16.00 lakh tonnes in
1999-2000.
Domestic off-take of jute goods and related developments Internal consumption of jute goods during 1998-99 registered a marginal growth (by 1.2%) to 14.04 lakh tonnes from 13.87 lakh tonnes during the previous season. This was attributable to the rise in demand of jute bags on Govt. account for packing foodgrains. The internal off-take during 1999-2000 (April-Oct) has , however, decreased by 3.5% to 7.60 lakh tonnes from 7.87 lakh tonnes during the corresponding period of last year. This decrease in consumption is due mainly to reduction of off-take of jute bags in various sectors. According to the Govt`s decision taken in line with the ILO convention regarding maximum permissible weight to be carried by an adult, all state foodgrains producing agencies including FCI have placed orders for 50 kg bags for the coming rabi season. The Standing Advisory Committee set up under section 4 of the Jute Packaging Material (compulsory use in Packing Commodities) Act 1987, met on 7.4.99 and 29.4.99 in order to have a fresh look into the present reservation Order. After analysing all the relevant issues relating to future requirements of jute bags for packing different specified end-user sectors covered by this Act, the supply scenario for jute goods, etc. the Committee recommended total exemption to the cement sector from compulsory use of jute bags for packing cement and continuation of 20% of production of urea to be packed in jute bags compulsorily, apart from existing stipulations of 100% foodgrains and sugar to be packed in jute bags. The Committee had also recommended that sugar industry may use non-jute packaging material to the maximum of 20% in a particular year in the event of temporary shrotage of jute bags, after obtaining permission from Ministry of Textiles, Govt. of India. Accordingly, Govt. have issued an Order on 1st July,1999 which became operative with immediate effect. The performance in
using jute bags by foodgrains and sugar sectors as per stipulations of
the Reservation Order has been satisfactory. Overall performance in using
jute bags by Fertiliser (Urea) sector has also been by and large satisfactory
(as per the latest Notification dt.1.7.99 which provides for 20% of urea
to be packed in jute bags).
Export of jute goods and related developments Export of jute goods during 1998-99 (April-march) declined to 1.95 lakh tonnes valued at Rs628.92 crores from 2.50 lakh tonnes valued at Rs755.00 crores during 1997-98. Although, there was an overall decline in export , the only redeeming feature was a marginal growth in export of CBC. The decline in overall export was attributable to competition from cheaper and lighter synthetic substitutes and sharp reduction in selling prices by Bangladesh exporters. Export of jute goods during 1999-2000 (April-Nov.) also declined to 114.60 thousand tonnes valued at Rs.378.28 crores from 141.9 thousand tonnes valued at Rs.424.77 crores during the same period of last year. This fall in export is due mainly to setback in major exportable items. For promoting export of jute goods, Govt. have taken various measures which include the following : 1. The External Market Assistance scheme operated by JMDC was rationalised w.e.f. 01.04.97 for a period of three years for giving added thrust on export of valued added and diversified jute products. 2. Special thrust is being provided to re-orient R&D activities with emphasis on enlargement of production base for diversified and value added jute products; 3. Accelaration of
export promotion programmes by JMDC under UNDP assisted National Jute Programme
and also under its own budget allocation.
Support prices for raw jute Minimum Support Prices
are being fixed by the Govt. every year on the basis of recommendations
of the Commission for Agricultural Costs and Prices so as to ensure a reasonable
return to the farmers after covering the costs of all inputs. The minimum
support price for TD-5 grade of jute grown in Assam has been raised from
650 per quintal for 1998-99 season to Rs.750.00 per quintal for 1999-2000
season. The gradewise price differentials have been fixed in such a manner
as to motivate farmers to improve quality out-turn of their produce. The
corresponding minimum support prices of all grades of jute and mesta for
various up-country markets in different states for 1999-2000 season have,
accordingly, been revised upward and widely published for information of
all concerned.
Industrial and labour scenario There are 73 jute
mills in the country, of which 59 mills are situated in West Bengal, 3
each in Bihar and UP, 4 in Andhra Pradesh and 1 each in Assam , Orissa,
Tripura and MP. At the end of October, 1999 the total number of looms installed
in the industry stood at 44162 and installed spindles at 550488 on the
fine side and 84608 on coarse side. These jute mills employ around 2.00
lakh workers. The maximum achievable spinning capacity in the organised
mill sector is estimated to be of the order of 18.75 lakh tonnes per annum.
As on 1.11.99 only 9 mills are lying closed affecting 22400 workers.
Raw Jute Scenario On account of inadequacy
of pre-monsoon shower all over jute growing areas, there was a shrinkage
in area in jute cultivation in 1999-2000 season. The Jute Advisory Board
in its last meeting held on 26th August,,1999 projected the crop size at
78 lakh bales. Accordingly, the projected budget for 1999-2000 season and
that estimated for 1998-99 season are indicated below :
According to the
above estimate, the carryover stock at the end of the current season i.e.
June, 2000 is likely to be of the order of 13.50 lakh bales which may be
sufficient to take care of the normal consumption requirement of the industry
for two months. In view of moderate size crop, a quantity of 5 lakh bales
of high grade jute for export production of various diversified products
is expected to be imported by Indian Jute Mills from Bangladesh in the
current season.
Prices situation of raw jute The 1999-2000 season began with prices of raw jute ruling well above the support levels in all the up-country markets fixed on the basis of Rs.750.00 per quintal for TD-5 grade ex-Assam. The prices of raw jute are not expected to rule below minimum support prices during the remaining part of the current season. As a result of this, farmers are assured of receiving remunerative prices for their produce. Some basic data on
the performance of the jute sector in the recent years is given below :
National Centre for Jute Diversification (NCJD) National Centre for Jute Diversification NCJD) was registered in January, 1992 under the Societies Registration Act, 1860 and established in June, 1994 under the Chairmanship of Secretary (Textiles) in order to give focussed attention to the diversification efforts in the jute sector. NCJD is required to consolidate R&D results of various institutes in jute and textiles and transmit these to the entrepreneurs for commercial production. It coordinates with various agencies and helps the entrepreneurs in arranging technical, financial and infrastructural support to encourage them to take up production and marketing of jute diversified products. The Council of Governors of NCJD has been reconstituted with effect from 24th September, 1998 for a period of two years. It consists of 25 members, drawn from various sectors like Jute Entrepreneurs, Banking, International Institutions and the Government. The NCJD is implementing
the following schemes for development of the jute sector:
Jute Service Centre (JSC) Scheme During the year NCJD
operated thirteen Jute Service Centres at different locations of the country.
The Jute Service Centres have during the year organised sixty training
programmes and Entreprenuership Development Programme (EDPs), which has
benefitted more than 900 individuals who have participated in these programmes.
The Centres have also organised around thirty five workshops of varying
nature and arranged forty three exhibitions/Buyer Seller Meets (BSMs) for
several Jute Diversified Products (JDP) enterprises. Major activities were
also organised in the North-East in association with NECON and JSC Guwahati.
Raw Material Bank Jute Yarn (and Raw
Material) Bank Scheme has been consistently providing the much needed support
of making available raw jute, jute yarn of various counts, laminated fabric
and other related raw material as applicable for jute diversified products
around the country. During the year under review eighteen Jute (and raw
material) banks were in operation. These yarn banks are spread over 14
States. During the year 1998-99 the sale of yarn through these yarn banks
was about 13 lakh kgs. and sale of laminated fibre touched over 1.70 lakh
meters.
Design Development The scheme aims at
keeping beneficiaries abreast with the latest trends so that the produce
of the assisted entrepreneurs remain market worthy. NCJD collaborated with
specialised agencies to generate designs for the small entrepreneurs. Collaboration
with National Institute of Fashion Technology (NIFT) was initiated in October,
1998 for development of designs for the small entrepreneurs and NGOs sector.
Ten design workshops were organised subsequently wherein around 140 marketable
designs were developed.
Market Support Mass market products
are being promoted through exhibitions and participation in fairs at various
locations around the country. During 1998-99 NCJD extended support by participating
in 42 exhibitions & Buyers Sellers meets. Many of these were organised
in association with the Jute Service Centres. The sales turnover is reported
to have been around Rs.76 lakhs.
Jute Entrepreneurs Assistance Scheme (JEAS) Under the JEA Scheme during the year 1998-99, 36 projects were approved for funding with assistance of a total of over Rs.428 lakhs under the loan scheme. Additionally, 50 projects (21 projects under second assistance) were cleared under grants from UNDP involving an outflow of Rs.92 lakhs. Promotion of these projects, it is estimated will enhance raw jute consumption by over 12,000 MT and generate employment for more than 4500 individuals. The above schemes
of NCJD have generated considerable enthusiasm amongst small entrepreneurs,
and NGOs. NCJD is helping these entrepreneurs, women/NGOs to consolidate
their production activities and enhance their production of such diversifed
products.
Jute Manufactures Development Council (JMDC) a) JMDC was set up as a statutory body with effect from 1.5. 1984 under the Jute Manufactures Development Council Act, 1983. The Act provides for establishment of a Council for the development and production of jute manufactures by increasing efficiency and productivity in the jute industry and the financing of activities for such developments and for matters connected therewith. JMDC has been delegated with all functions relating to export promotion in the jute sector and also to perform other activities in the domestic market of jute sector, as are performed by a commodity board. The activities of JMDC are wholly financed by the Government of India out of the cess collected on various jute manufactures. b) The major activities undertaken by JMDC during 1998-99 were as follows: i) Buyer Seller
Meet
ii) Market Exploratory
Missions
The Council also attended the 102nd meeting of the Executive Committee of International Cocoa Organisation (ICCO) at ICCO Head Quarter in London, for promotion of Food Grade Jute Bags / Cloth. In the current year (1999-2000) till November’99, the Council has organised following market promotion activities; i) Organised 8 exclusive jute exhibition-cum-sales, 4 workshops/interactive meetings and organised participation in 2 product specific fairs. ii) Participated in 2 foreign fairs alongwith 1 buyer seller meet in association with HEPC. iii) JMDC has organised the retail sale outlets or portions thereof as dedicated outlets for diversified jute products. One showroom at Hyderabad is managed by the Council, three showrooms at Bangalore, Chennai and Mumbai are managed by Central Cottage Industries Corporation, one in Patna by the Bihar State Export Corporation, one in Ahmedabad by Madhya Pradesh Hasthshilpa Vikas Nigam and two showrooms in Calcutta by the Jute Corporation of India and West Bengal Handicrafts Corpn. iv) JMDC, in co-ordination with IJIRA, NIRJAFT and CRIJAF of Calcutta, PSG College of Technology and SITRA of Coimbatore, IIP and BTRA of Bombay, collates the results of the research and recent developments in the diversification and newest uses of jute and with the aid of NCJD, extends guidance and support for upcoming entrepreneurs with new and innovative jute products. v) The Council undertook campaigns for generic promotion of jute (both traditional and diversified jute products). vi) The website of
the Council www.jute.com has enabled the users to have direct access to
the updated statistics and information on jute.
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