Jute support price raised to Rs1,375 a quintal

The cabinet committee on economic affairs (CCEA) has fixed the minimum support price (MSP) for TD-5 grade jute ex-Assam at Rs1,375 per quintal for the 2009-2010 season, up Rs125 from the MSP announced last season.

The increase in the MSP of raw jute is expected to encourage the farmers to step up investment in jute cultivation and thereby increase production and productivity of jute in the country, a government release said.

The Jute Corporation of India (JCI) would continue to act as nodal agency to undertake price support operation at the minimum support prices and the losses incurred, if any, in the MSP operations, will be fully reimbursed by the central government.

Production of jute is concentrated in the states of West Bengal, Assam, Bihar and Orissa. Jute is a highly labour intensive crop and the human labour component constitutes nearly 75 per cent of the total input cost.

The composite variable input price for jute as measured by variable input index has increased by 9.28 per cent for Assam, 16.07 per cent for Bihar, 8.46 per cent for Orissa, 7.71 per cent for West Bengal between 2006-07 and 2009-2010.