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Jute Industry

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The importance of the jute sector to the Bangladesh economy, in particular, cannot be over-stated, it is a major cash crop for over three million small farm households, the largest industry, producing about one- third of manufacturing output, and the largest agricultural export commodity in Bangladesh. The livelihood of about 25 million people (almost one - fifth of the total population) is dependent on jute - related activities in agriculture, domestic marketing, manufacturing and trade Rejuve
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    0500100020082009201020112012 Average Raw Jute Price (USD/Tone) The importance of the jute sector to the Bangladesh economy, in particular, cannot be over-stated, it is a major cash crop for over three million small farm households, the largest industry, producing about one- third of manufacturing output, and the largest agricultural export commodity in Bangladesh. The livelihood of about 25 million people (almost one - fifth of the total population) is dependent on jute - related activities in agriculture, domestic marketing, manufacturing and trade Rejuvenation of Jute Industry The government of Bangladesh is trying to rejuvenate the jute industry by injecting Tk 4 billion in the current financial year (FY) as loan to jute exporters. Each of four state-owned banks will allocate Tk 1 billion under the auspices of the Banking Division of the Ministry of Finance. According to the present government policy, Government want to keep the mills in operation instead of closing down on the plea of losses and therefore, the Government in the meanwhile opened the Peoples Jute Mills Ltd., Khalishpur Jute Mills Ltd. and the Qawmi Jute Mills Ltd. and put them into operation. Moreover, in order to minimize the production losses, several effective measures have been taken up for implementation, such as, the machinery of closed Adamjee Jute Mills are being used by transferring them to the other selected jute mills, proper maintenance of the machinery and training of the workers which will help enhance the productivity and quality of products   Jute Export: (in USD million) Bangladesh is getting back to the golden era in recent year as demand for jute and jute made product is increasing as it is considered as bio-degradable product. As Bangladesh has favorable climate to produce jute therefore, Bangladesh currently exporting 70% of total raw jute. There is increasing growth has observed in 2010-11 and 2001-12 year but in 2012-13 export of jute decreased. 2012-13 2011-12 2010-11 Amount % Amount % Amount % 211 1.1 236 2.36 186 1.1 Export price of Raw Jute   Bangladesh is the largest exporter of raw jute. Therefore the local price of raw jute in Bangladesh is deemed the international price. The export price of raw jute in Bangladesh was in increasing trend during 2008-2010 but the prices declined during 2011-2012. Because local traders and industries are fail to procure jute due to fund crisis, which pulled down jute price.   Source: IJSG, Jute Matters VOL-1, Issue-5 April -2013 Table: Average export price of raw jute of Bangladesh   Total Area of Jute production Total area under jute crop has been estimated at 16, 82,903 acres (6, 81,034 hectares) which is 10.40% lower than that of last year. Comparative area estimates of jute crop of 2011-12 and 2012-13 are as follows Source: Bangladesh Bureau of Statistics Table-3: Total Area of Jute Crop 2011-12 2012-13 Area ( In Acre) Area (In Acre) 1878256 1682903    Yield Rate of Jute Average yield rate has been estimated at 4.52 bales per acre (11.175 bales per hectare) compared to 4.53 bales per acre (11.204 bales per hectare) in the last year, which is 0.26% lower. Average yield rate of this year as well as the last year are computed as follows; Source: Bangladesh Bureau of Statistics   Table-4: Yield Rate of Jute Crop Total Jute Production   Total jute production in this year has been estimated at 76, 10,585 bales which are 4.90% lower than that of last year. Total production figures of this year and the last year are as follows; 2011-12 2012-13 Bales Bales 8003023 7610585 Source: Bangladesh Bureau of Statistic Table-5: Total Production of Jute Crop Number of Jute Mills At present there is increasing private investment along with public investment in jute industry. Jute mills in Bangladesh is controlled by three Association which are    BJMC( Bangladesh Jute Mills corporation)    BJMA(Bangladesh Jute Mills Association)    BJSA(Bangladesh Jute Spinners Association) Bangladesh Jute Mills Corporation (BJMC):   BJMC established in 1972 to manage, supervise and control all abandoned private jute mills. The number of jute mills under its supervision was 82. But from the year 1977 to 1985-86   number of jute mills started to decline and turn into 27 mills. 50 mills of 82 were privatized, 2 mills were declared scrap and 2 mills were handed over to the privatization commission. Bangladesh Jute Mills Association (BJMA): There are 124 mills are controlled by BJMA which is the private mills owners association. Among 124 mills 38 of these are privatized from public company and 86 new mills are established. BJMA has 67 composite mills, 4 carpet producing mills and rest of the 15 mills are producing unconventional jute products. Among 38 mills which are privatized, 12 mills are on operation, 15 mills are partially in operation and 11 mills are not in operation. 7 of newly established 86 mills are out of operation.   Bangladesh Jute Spinners Association (BJSA):   Bangladesh has 92 jute spinning mills which has production capacity of 825000(MT). Currently Number of total spindles are 217792. There are 65000 employees are working.   Production of Jute product Year Yarn (BD) Hessian (BD)* Hessian (IN)* Sacking (BD) Sacking (IN) Carpet Backing (BD) Carpet Backing (IN) 2012-13 618.58 57.59 210 275.82 1218.2 10.81 2.9 2011-12 537.37 51.57 239.9 269.02 1165.1 10.81 3.6 2010-11 451.41 45.24 244.4 196.21 1076.9 16.79 4.7 2009-10 425.56 40.86 206.5 202.53 921.6 15.99 2.4 2008-09 330.84 37.83 297.5 198.02 1071.4 13.39 4.5 *BD (Bangladesh)*IN (India) Source-IJSG Table-4 Production of jute product of Bangladesh & India 2011-12 2012-13 Yield Rate Per Acre (Bales) Yield Rate Per Acre (bales) 4.53 4.53    05000001000000150000020000002500000IndiaBangladeshChinaUzbekistanNepal201020112012 Bangladesh is produces Jute yarn and maintaining increasing trend. On the other hand India does not produce yarn. In case of producing hessian Bangladesh is performing well from year to year but India is maintaining a absolutely. Jute Production Comparison   India has taken advantage of recent improvements in the cultivation of jute to become the largest producer or cultivator of jute in the world. Using advanced production techniques, India also has dominance over the worldwide jute products market. Due to national law to use jute as packaging materials, India is the largest producer and consumer of jute in the world. Bangladesh is currently the second largest producer of jute fiber, now overtaken by India. The Jat Area, popular for best quality of jute fiber is located in Source: NJB, Ministry of Textile, Government of India. Table: Production Comparison Bangladesh. Therefore, Bangladesh is able to supply the best quality jute fiber in the world. However, Bangladesh falls behind other competitors in applying recent technological advancements. In terms of world export of jute fiber, Bangladesh's share is more than 70%, which makes Bangladesh the largest exporter of jute fiber in the world.   China is the third largest in terms of jute cultivation. Due to China's huge population, the Chinese are not emphasizing the cultivation of jute, as it competes with other staple crops. Due to modern effective agriculture, they have the highest yield of jute fiber in the world. Future Import Destination: Jute is one of the most affordable natural fibers and is second only to cotton in amount produced and variety of uses of vegetable fibers. As an environment friendly and 100% bio-degradable fiber, world production of jute as well as consumption and trade of jute and jute products are also increasing. Many countries in the world have started to prefer  jute products as jute is sustainable product compare to plastic and bio-polythene. Therefore, market for jute and jute products are changing year by year.  Promising jute products for import Different types of jute products are being traded around the world. Twine, woven fabrics, sacks and bags is decreasing trend in global import 1 ; whereas yarn and carpet showed increasing pattern. So, it can be concluded that yarn, carpet and different floor coverings will be imported significantly by different countries in the coming years.   1  Jute Matters, A Monthly publication by IJSG (International Jute Research Group), Vol-1, Issue-11 October-2013.
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