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Why Did Some Jute Bags Exporters Stop Supply For Up 3 Months In India
Jute bags are becoming an essential exemplar for defining the global call for turning into eco-friendly ways of life. The Indian Government recently took a drastic step in ordering more than a million of gunny bags, for mainly for transforming the Agricultural Packaging mode. This has pushed jute bags suppliers with a crunch.
Jute mills across the nation have been asked by the industry to call off their exports for up to 3 months, as it is currently hauled with a backlog of up to 50% of supply. The main reason for this could be the rising demand of gunny bags and sacks for making them mandatory for the Agricultural Packaging. But are the Jute Mills ready to make such a huge step as of yet?
The NAFED Hijacking
The Jute Industry largely opines on suspending supplies to the National Agricultural Cooperative Marketing Federation (NAFED), is it was imposed by the Indian Government for making Jute Packaging or gunny bags mandatory for most of the agricultural industry. Reportedly, up to 680,000 bales have been supplied by the end of February towards the unprecedented decision of the Government to procure 1.24million bales. But due to the immense shortage of resources, caused by this “hijacking”, jute bags exporters are fetching a premium of 5% to 8%.
According to the Indian Government, it is a violation of law, if the prices exceed more than the amount fixated by the Jute Commissioner- under the formula of the Tariff Commissioner. This, and the fact that the Indian Government has yet not taken any action to resolve the issue, since there has not been any formal complaint against the prices doubling up.
The increased prices of the jute gunny bags are evident, with the rates that are shelled out by 2 prime Government Agencies, NAFED and the Food Corporation of India (FCI). The cost reaching up to Rs 82,000 per tonne.
As of now, the Indian Government has taken back it’s orders for the great number of jute bags, working together towards catching up to the backlog.
The Golden Fibre
Jute, indeed solves a greater number of problems. This being high-on demand has also to do with the fact that the fashion world has also joined forces making a staggering contribution to the demands. Moreover, thanks to the organisations like GOTS the production processes are also shaped in a more socially responsible and environment friendly ways.
However, Government need to think twice when it’s ordering something to supply the one of the most densely populated countries in the world. It’s a huge number and asks for a more systematic and step by step upgradation that a one drastic step could cover.
In the end of the day, it’s a good sign that Governments are identifying the need for enforcing more eco-friendly norms into the economy and other aspects of civilization. All it takes is a good planning and some more time.
Earthyy Bags is an India based house of jute bags exporters, that supplies to globally. They are B2B jute bags suppliers on wholesale basis, the ideal resource for getting bespoke manufacturing of creative designs. From fashion bags, to promotional bags, there is a wide range of designs to choose from as it crafted from authentic, high quality jute/hemp/burlap.
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