Bumper crop forecast spells concern for jute farmers
The prospect of a
bumper jute crop this year is more a cause of worry than pleasure to almost a million
Indian farmers, with the minimum support price (MSP) mechanism in a shamble.
A bumper crop would
mean a sharp decline in prices, farmers will have to dispose of their produce at whatever
price they can get. However, industry sources feel the bumper crop would be an advantage
in terms of lower cost of production for the Rs. 35 bn jute products industry, which is
trying to counter a strong plastic lobby.
The Indian Jute Mills
Association (IJMA) has projected a 20 % jump in jute output to 10 m bales in ‘00-01
from about 8.5 m ales in ‘99-00. "Considering the extent of sowing that was
prompted by extremely good weather between February and May, and average acreage, the crop
this year is likely to be more than 10 m bales of 180 kg each," according to IJMA
chairman Sanjay Kajaria.
The bumper crop would
have yielded significant benefits to farmers in terms of higher volumes, but as the
average industry demand, according to IJMA estimates, it is only in the region of 8.6m
bales per annum, the farmers will have little option than to dispose of their extra
holdings.
Apart from industrial
consumption, about 6,00,000 to 7,00,000 bales which is used for domestic purposes in rural
areas, India will have to import about 7,00,000 bales of jute from Bangladesh for
specialized products.
If production remains
in accordance with what the IJMA is projecting, the govt. will have to intervene in a big
way to help the farmers as by the end of June ’00 (‘99-00), the carry-over stock
will be about 2.2m bales. This will create pressure next year on farmers as the industry
is unlikely to consume more than its requirement of 8.6m bales, jute experts said. |
