Raw jute shortage and price spike put West Bengal mills under pressure
West Bengal’s jute sector is urging the new state government to intervene as raw material shortages, trade restrictions and surging prices disrupt mill operations. Industry groups warn that more closures and labour distress could follow without rapid relief.
West Bengal’s jute industry is warning of wider mill stoppages and job losses as an acute shortage of raw jute collides with a steep rise in input prices. The Economic Times, citing industry sources, reported that at least 14 mills across the Hooghly industrial belt have either suspended operations or are facing severe production disruptions because raw material is unavailable at viable cost.
Industry representatives say the crisis has escalated sharply over the past four months. The Jute Balers’ Association benchmark rate rose from Rs 11,600 per quintal on January 1 to Rs 17,100 per quintal on May 6, which is more than three times the minimum support price of Rs 5,650. At the same time, the market lost a transparent reference point after trade restrictions and a zero-stock order led the JBA to stop publishing quotations from May 7.
Millers argue that administrative controls have not solved the raw material problem and have instead intensified uncertainty. With the last JBA rate effectively frozen, trade banned and the next crop still around ten weeks away, mills say they are being asked to keep operating without dependable raw jute supply. Their finances are under additional strain because government-controlled B-Twill sacking prices have not kept pace with raw material inflation, squeezing working capital and forcing shift cuts.
The labour impact is already serious. Industry estimates suggest around 75,000 workers are facing involuntary underemployment because of partial shutdowns, lower production and irregular operations in North 24 Parganas, Hooghly and nearby industrial areas. The broader sector employs about 200,000 workers. Market participants also allege that a large share of the available crop had already been cornered by stockists, leaving only about 200,000 to 300,000 bales in the market at this late stage of the season.
The Jute Commissioner’s zero-stock order took effect on May 5 in an attempt to improve mill access to raw material, but industry groups describe it as a double-edged move. JBA member Om Soni said suppliers are caught between rising costs, unpaid dues and strict stock rules. In a representation to the union textiles secretary, the association said that trade restrictions and the lack of an official benchmark price had pushed the market into complete uncertainty and made procurement planning far harder for mills.
The industry is now asking the new West Bengal government to unlock residual stocks, relax or extend the restrictions and facilitate emergency imports from Bangladesh. With the current restrictions due to remain until June 30, the new jute year beginning on July 1 and fresh crop arrivals expected only toward the end of July, millers warn that many operations may not survive the supply gap without immediate corrective action.