Jute supplies are in high demand; Ludlow Jute and Cheviot up to 17%; this is why

Shares of jute goods manufacturing and sales companies rose up to 17 per cent on the BSE in intraday trade on Monday after the government on Friday approved mandatory packaging of 100 per cent food grains and 20 per cent sugar in diversified gunny bags for the jute. year 2023-24. A jute year runs from July 1 to June 30. Shares of Ludlow Jute & Specialties rose 17 percent to Rs 99.90 and Cheviot Company rose 16 percent to Rs 1,480 on the BSE. These stocks were trading at their respective 52-week highs. Shares of Gloster rose 9 percent to Rs 922 in intraday trade. In comparison, the S&P BSE Sensex rose 0.06 percent to 69,865 at 10:51 am.

The central government purchases jute bags worth around Rs 12,000 crore every year for packaging food grains, ensuring a guaranteed market for the produce of jute farmers and workers, PTI reported.

The jute sector plays a crucial role in the Indian economy, especially in eastern India, by providing direct and indirect employment and generating export income. India is the world's largest producer of jute, also known as golden fiber.

The jute industry faces a shrinking area, excessive dependence on government orders, competition from Bangladesh and a lack of modernization and diversification. Furthermore, the sector has been influenced by government policies in key areas over the years.

With increasing awareness about the harmful effects of synthetic packaging materials on the environment, the demand for jute goods is poised to grow both nationally and internationally. The demand for eco-friendly products bodes well for value-added JDPs such as jute geotextiles, horticultural products and lifestyle products such as jute shopping bags, carpeting and apparel, Cheviot Company said in its annual report for FY 2023.