Jute yarn sector gets saturated

FE Report | Published: March 25, 2014 00:00:00 | Updated: November 30, 2026 06:01:00

Jute spinners at their annual general meeting (AGM) held Monday at in the city observed that the sector's excess capacity is causing a reduction in export earning.
They said due to having a nearly 0.1 million tonnes of carryover, spinners are being forced to reduce the price of their product which, is giving the bargaining power to the importers.
The AGM was presided over by BJSA president Shabbir Yosuf.
Textile and jute minister Muhammad Imaj Uddin Pramanik, secretary of the same ministry Phani Bhoushon Choudhury, and secretary of BJSA Shahidul Karim, among others present at the meeting.
"It is now a great headache for the oversaturated jute spinning sector, which is depriving the country of a large amount of export earning while also giving the importers a bargaining power," Shabbir Yosuf said.
He said in the financial year 2012-13, the spinners exported 0.516 million tonnes of products worth Tk 34.96 billion, which was 0.458 million tonnes worth Tk 33.67 billion in FY'12.
He said per tonne jute yarn was sold at Tk0.073 million in FY'12 which reduced to Tk 0.0677 million in FY'13, he said .
Bangladesh is the key source for jute yarn in the world, supplying 90 per cent of the global requirement of nearly 0.6 million tonnes, according to the Department of Jute (DoJ).
Carpet and other handicraft industries in Iran, Turkey, Egypt, Sudan (both North and South), Syria, India and China are the main destinations for Bangladeshi jute yarn. The number of the country's jute spinning mills has increased to 96 recently from 80 mills five years back.
"Production has increased to 0.75 million tonnes annually against the export demand of hardly 0.65 million tones," Mr Yusuf said.
He said the export income in the jute sector has reduced while the price of quality raw jute has increased significantly in the local market.  
"But, the government, without considering it, has reduced export subsidy for the current fiscal year (FY) to 7.5 per cent from 10 per cent fixed earlier," he said.
Spinners also urged the government to reduce the tax at source (at cash subsidy) to 1 per cent from the existing 5 per cent.
However, the minister and the ministry secretary promised the yarn exporters to consider their demands the upcoming annual budget for the betterment of the jute sector.
According to the state-run Department of Jute (DoJ), the country has now 96 jute spinning mills, where 80,000 workers produce 0.75 million tonnes of yarn annually.
The sector exported nearly 0.52 million tonnes of yarn and fetched around $ 650 million in FY '13, which was 67 per cent of the total earnings from the jute sector.
Bangladesh is home to 4.2 million jute farmers, who cultivate jute on 0.75 million hectares of land and produce 1.3 million tonnes of raw jute annually, according to DoJ.