1503814813_2VJ7tN_Jute.jpg
The sector regulator has rationalised the raw jute stock limit for mills to a level, which is equivalent to their one-month average consumption, from the two-month requirement to augment the availability of the raw material in the market.
Photo Credit : Reuters
An expert committee meeting has been convened next week to assess the raw jute supply situation and prepare a roadmap to ensure that production of bags for foodgrain packaging is not hindered, as millers are staring at closing down their units due to a scarcity of the main raw material, industry sources said on Friday.
The West Bengal government has not submitted its estimated raw jute production and the crop loss due to cyclone 'Amphan' last year, while the Office of the Jute Commissioner has assessed the situation for the current season, they told PTI.
'The state had convened a meeting of a group of ministers on the issue but failed to furnish an assessment of the situation before the Jute Commissioner,' the sources in the industry said.
Meanwhile, the sector regulator has rationalised the raw jute stock limit for mills to a level, which is equivalent to their one-month average consumption, from the two-month requirement to augment the availability of the raw material in the market.
Indian Jute Mills Association, an industry body, had demanded the withdrawal of the order.
'Already, six mills have been closed in the last few days, and at least one-third of the 60 units may go for closure due to the shortage of raw jute,' the sources said.
New crop will hit the market from August, but the dearth of the raw material may force mills to halt their operations, which could hit the supply of foodgrain packaging bags, they said.
The industry had estimated that the volume of raw jute that was hoarded during the November-December period last year could be to the tune of 23-25 lakh bales, the sources said.
Jute Commissioner Moloy Chakraborty had said his office was doing an internal assessment of the raw jute situation after the allegations of supply shortages were made.
Sources said the JC's office had taken action against 30 jute mills for flouting the government supply norms and diverting the materials to open market for short term profits.
(PTI)