Shares of makers of jute products such as Gloster, Cheviot and Ludlow Jute were sharply higher by up to 5% in trade on January 22 on hopes of higher Minimum Support Price (MSP) on raw jute for the season 2025-26.
CNBC Awaaz reported citing people familiar with the development that the Cabinet Committee of Economic Affairs (CCEA) could take the decision in this regard at a meeting today. It is learnt that the hike in MSP is likely to be significant, and would be a major sop for the farmers involved in the production of jute.
The MSP hike is being proposed for the TDN3 category of jute, which is coase, with minor defects, and used extensively for industrial purposes. It is understood that the Centre is keen to encourage the use of jute in the packaging industry as well as the use of jute bags.
Last year, the MSP on raw jute had been raised for the 2024-25 season as well by Rs 285 to Rs 5,335 per quintal. The MSP hike is expected to help encourage the production of jute in India.
With the ban on single use plastic, the opportunity to ramp up use of jute carry bags has significantly increased.
According to Ludlow Jute, the industry is facing concerns of reduced orders for gunny bags by the Food Corporation of India (FCI) and State Procuring Agencies (SPAs), as well as a serious shortage of workers.
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