Context:
Recently, the Cabinet Committee on Economic Affairs (CCEA), has approved the Minimum Support Prices (MSP) of Raw Jute for Marketing season 2025-26.
More on the News
- The MSP of Raw Jute (TD-3 grade) has been fixed at Rs.5,650/- per quintal for the 2025-26 season, which is an increase of Rs.315/- per quintal over the previous Marketing season 2024-25.
- The approval is in line with the principle of fixing MSP at a level of at least 1.5 times India’s weighted average cost of production as announced by the Government in the Budget 2018-19.
- The government of India has increased the MSP of Raw jute by 2.35 times from 2014-15 to 2025-26.
- Jute Corporation of India (JCI) is the Nodal Agency to undertake Price Support Operations and the losses incurred, if any, in such operations, will be fully reimbursed by the Central Government.
MSP Regime of India
The Minimum Support Price (MSP) is a form of market intervention by the Govt. to insure agricultural producers against any sharp fall in farm prices.
MSPs are announced by the Cabinet Committee on Economic Affairs (CCEA) at the beginning of the sowing season for certain crops (currently 23) on the basis of the recommendations of the Commission for Agricultural Costs and Prices (CACP).
The list of crops is as follows:
- Cereals (7) – paddy, wheat, maize, jowar (sorghum), bajra (pearl millet), barley and ragi
- Pulses (5) – gram, tur, moong, urad, masur (lentil)
- Oilseeds (7) – groundnut, rapeseed-mustard (+ toria), soyabean, sesamum, sunflower, safflower, nigerseed
- Commercial crops (4) – copra (+ de-husked coconut), sugarcane, cotton and raw jute.
About Jute Crop & Jute Industry of India
- Jute, also known as golden fibre, is a crop that grows well in humid tropical climates and requires about 50 cm of water for its growth.
- For better growth, a mean temperature between 15oC and 34oC is best suitable for the crop and a mean relative humidity of 65% is required for better growth.
- It can be raised on all kinds of soils from clay to sandy loam, but loamy alluvials are best suited.
- It is a cash crop and it is sown from March to May and harvested from the end of June to September upon the weather conditions.
- It is the second most important cash crop in India after cotton in terms of cultivation and usage.
- India is the largest producer of Jute in the World, accounting for about 75% of estimated world production. However, most of the Jute (about 90% of total production) is consumed domestically due to its vast domestic market demand.
- The major jute-producing states in India are West Bengal, Assam, Bihar, Orissa, and Andhra Pradesh. However, West Bengal is the largest jute-producing state, accounting for 70 of the country’s 94 composite jute mills.
- The exports of Indian jute and jute products have increased over the years. Between 2015-16 and 2020-21, the total jute exports grew at a CAGR of 9%.
- India exports jute and jute products mainly to the USA, the UK, Australia, Belgium, Egypt, Germany, Italy, Japan, Saudi Arabia, and Turkey.