Kolkata: Several jute mills in West Bengal have begun suspending operations after failing to procure raw jute, the price of which has been capped at Rs 6,500 per quintal by the central government, industry sources said.
At least 10 mills have closed down, impacting 15,000-20,000 workers, and more closures are due in the next few months, they said.
Tepcon International India Ltd, which manages the Hanuman Jute Mill in Howrah, has issued a notice for temporary suspension of work from Wednesday due to non-availability of raw jute at the ceiling price fixed by the Jute Commissioner.
The Centre had recently turned down the request of jute mills to revise the raw jute fair price to Rs 7,200 per quintal in line with the current domestic and international prices.
This could lead to a shortfall of supply of environment-friendly packaging bags, as farmers may get discouraged to produce more, one source said.
If raw jute price settles at Rs 6,500 per quintal farmers’ price realisation will suffer and discourage higher production, he said.
The jute regulator, however, believes there is ample raw jute in the market, but under the control of hoarders, and fixing a ceiling price will help supplies to mills.
Earlier, Indian Jute Mills Association (IJMA) representatives had met Union Textile Minister Piyush Goyal and urged him to consider relaxing the ceiling price.
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