A man works at a jute mill in Rangpur. Bangladesh has so far exported 700,000 bales of raw jute this year. Photo: Sk Enamul Haq
Jute goods and raw jute exports witnessed a rise in the first quarter, at a time when earnings from most export items slipped significantly because of the late impacts of global recession.
Jute goods exports are on the rise due to increasing pressure for using degradable and eco-friendly products in parts of the world.
Raw jute exports saw nearly 28 percent growth in the July-September period, earning over $36 million, but people involved in jute goods and jute yarn manufacturing blamed the export of raw jute for the low supply and high prices of jute on the local market. They demanded curbs on raw jute exports to safeguard local jute goods makers.
Raw jute exporters said high demand for the golden fibre in India, Pakistan and China is a catalyst to export growth, which they said helped jute farmers receive good prices this year.
"The price of raw jute increased by $100- $150 a tonne this year on the international market, also pushing its price on the local market," said Rezaul Karim, former chairman of Bangladesh Jute Association, a platform of mainly raw jute exporters.
India and China are importing raw jute to produce different jute-made products, including sacks, yarn and bags, demand for which is increasing in those countries.
On the other hand, Bangladesh now exports jute products to around 30 countries, including Canada, Japan, EU and the United States. In July-September, jute goods exports earned $85.62 million, witnessing 5.18 percent growth.
Despite export growth, jute goods makers said they find it difficult to continue production, as raw jute prices have increased substantially on the local market.
The prices of raw jute per maund now hover between Tk 1,400 and Tk 1,600 on the domestic market, which was around Tk 1,100 two months ago.
"We will no longer be competitive if we have to buy raw jute at high prices," said Kamrul Islam Khan of the Bangladesh Jute Goods Association.
The export of raw jute earns around $600 per tonne, while jute goods made from the same quantity of jute fetches $900, according to Khan, who said the government should discourage raw jute exports to save the local industry.
A total of 178 public and private jute mills, which directly employ 150,000 workers across Bangladesh, make different jute products.
On a shortage of raw jute, Bangladesh Jute Spinners Association Chairman Ahmed Hossain said local jute mills would shut if raw jute supplies were not ensured.
He also said a segment of traders may have hoarded raw jute to earn quick money, as "there is no sensible reason behind a raw jute crisis during this time of the year".
Of the total five million bales of jute produced this year, 700,000 bales (one bale=180kg) of raw jute have been exported and local jute mills bought one million bales. The market should have another three million bales of raw jute, Hossain said.
Jute goods makers urged the government to conduct a survey on the total raw jute stock and allow raw jute exports only after meeting local demand.
Director General of Department of Jute Mahmudul Haq Bhuiyan said it was difficult to impose an export ban on raw jute in the present global trade climate.
On the low supply of raw jute to local mills, he said: "It is the responsibility of the jute mill owners to collect raw jute in advance, according to their needs. It was presumed that jute prices might increase at this time of the year."
Bhuiyan said farmers benefited from the high jute prices.