25 jute mills shut down in two years

About 25 jute mills - both small and large -- were shut down over the last two years following decline in the demand for jute-made bags in the international market, millers said.
They also feared that without diversification of products and implementation of the mandatory use of jute bags locally, all the country's jute mills would be sick in near future.
Fifteen big and 10 small jute mills were closed down in the past two years as the demand for jute-made bags was very poor against their supply in the global market, said the millers.
Even the millers have cut the prices to attract foreign buyers but they are not getting desired response from them, they said.
The mills that are still in operation have cut their production to overcome the situation by reducing the demand-supply gap, said Bangladesh Jute Mills Association (BJMA) chairman Muhammad Shams-uz Zoha.
 "Ultimately almost all the jute mills will be sick unless an alternative domestic market for jute goods is created," Mr Zoha said.
According to the BJMA, the export earnings from jute bags were worth Tk 11.14 billion in the fiscal year (FY) 2012-13 whereas the amount was Tk 9.59 billion in FY 2013-14 and Tk 3.44 billion in the July-December period of FY 2014-15.
Jahirul Islam, owner of Uddog Jute Mills at Sirajganj, was forced to close his mill in July 2013 as he was unable to make profit.
The mill with seven tonnes of production capacity was set up in 2011. It usually produced jute sacks for the local market.
But the prices of his product were falling gradually as big millers entered the local market following lower demand of their products in the international market, he said.
"I was unable to pay the bank loan. So at last I was forced to sell my factory," said Mr Islam.   
Maksudur Rahman, assistant general manager of Prime Jute Industries, said his mill turned into a sick one failing to get export orders from the buyers against their production.
The millers demanded action from the authorities concerned to implement the 'Mandatory Jute Packaging Act 2010'. They said the situation would be more worsening in future as the demand for jute bags is gradually declining in the overseas market.
BJMA secretary Abdul Barik Khan said India, the largest market for Bangladeshi jute goods, has reduced import of jute bags. And now it is considering phasing out the mandatory use of jute bags.
Besides, the demand for jute bags declined in Syria, Sudan and Thailand.
In this situation the government should implement the mandatory jute packaging law immediately as in future Bangladesh's jute goods would have to be marketed locally, he said.
He also emphasised the need for product diversification and modernisation of machinery of the mills so that they can produce goods as per global requirement.
Mr Khan, however, said the requirement for diversified products like shopping bags was increasing gradually in foreign countries.  
About 400,000 people from farmers to exporters' level are involved in the jute sector. A total of 145 jute mills are operating under the BJMA and 26 under Bangladesh Jute Mills Corporation (BJMC).
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