Some jute mills face closure as fibre scarcity deepens

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S M Jahangir
A number of jute mills are facing closure as the supply scarcity of the fibre has deepened even after a ban on export was imposed by the government, the industry sources said.
The price of raw jute has again shot up by nearly Tk 300 per maund in the domestic market over a week, they said, predicting a further rise in the price of their main raw material.
Raw jute is now selling at Tk 1800 per maund while the price was Tk 1500 a maund just a week ago, the industry operators said.
The cost of production have already gone beyond the affordable level following the hike of their main raw material, private jute mills operators said.
"We are facing an acute supply shortage of raw jute despite a ban on its export," a private jute mill operator told the FE Sunday.
He went on: "If the raw jute scarcity continues, a good number of jute mills may either face closure or cut their production."
The sector insiders, however, attributed the prevailing supply scarcity to a shortage of domestic raw jute output coupled with increased consumption by the local jute mills.
According to them, the country's jute mills - both under government and private sectors - requires about 4.2 million bales of raw jute for the current financial year compared to last year's consumption of nearly 3.5 million bales.
This is mainly because the mills under the state-run Bangladesh Jute Mills Corporation (BJMC) has almost doubled their raw jute requirement to 1.2 million bales while that of the Bangladesh Jute Mills Association has also increased their demand to 0.8 million bales from 0.6 million bales previously.
The demand of raw jute for the country's jute spinners remains more or less static at 2.25 million bales, the industry sources informed this correspondent.
Although the local jute mills have already procured about 2.5 million bales of raw jute, still they require 2.0 million bales more for continuing their production for the rest of the year.
The country, on the other hand, had already exported about 1.0 million bales of raw jute.
Given the aforesaid situation, there remains shortage of a 1.0- million bales of raw jute for the current fiscal.
Taking the shortfall into consideration, the country's jute millers have suggested continuation of the ban that the government had imposed on export of raw jute following its short supply in the domestic market.
They have also suggested that the government should conduct a comprehensive assessment on the total raw jute availability and take necessary next plan of actions on its basis in order to keep the domestic jute goods production unharmed.