India hikes jute MSP by 6%; still lower than market prices

29 Mar '23

2 min read

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Insights

Indian government has announced a 6 per cent increase in MSP for jute for 2023-24 season, set at ₹5,050 per quintal for raw jute.
This is lower than the current market prices.
The government has stated that the MSP hike will provide a return of 63.20 per cent over the average cost of production.
JCI will provide support if market prices fall below MSP.

India has announced a 6 per cent hike in jute minimum support price (MSP) for 2023-24 season compared to the last season, set at ₹5,050 per quintal for raw jute. This increase is 7 per cent lower than the current market prices, which are hovering around ₹5,200-5,400 per quintal in producing areas, indicating that the government's role in procurement may be limited next season if prices remain high.

This hike in MSP will provide a return of 63.20 per cent over the average cost of production. The Jute Corporation of India will undertake price support operations if market prices fall below MSP, ministry of agriculture and farmers welfare said in a press release.

Jute, a natural fibre used for packaging, faces tough competition from synthetic fibres which offer cheaper packaging solutions. However, synthetic packaging is a major contributor to non-degradable waste, and the Indian government is making efforts to promote eco-friendly jute packaging. The Jute Packaging Materials (for compulsory use in packaging commodities) Act, 1987, stipulates certain commodities to be packed in jute.

India, along with Bangladesh, is one of the world's largest jute producers. India produced 95 lakh bales of 170 kg of jute in 2022-23, up from 90 lakh bales in 2021-22, 60 lakh bales in 2020-21, 68 lakh bales in 2019-20, and 72 lakh bales in 2018-19.

Fibre2Fashion News Desk (KUL)

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