The recent floods in the northern region of the country have led to a decline in jute yields, triggering a shortage and high prices of the export product in the market.
Many jute mill owners have complained that a section of traders started stockpiling jute when the price of jute started rising immediately after the floods.
Consequently, jute production and exports are being disrupted in at least 40 small and large jute mills in the region and mill owners are incurring huge losses.
With the crisis of jute in the market, the price of jute has increased up to Tk1,100-1,400, depending on the variety and area. Even at this price, good quality jute is not available in many areas, including Sariakandi of Bogura.
The average production per day has decreased by 20 tonnes
ATM Shafiqul Hasan Jewel, owner of Hasan Jute and Spinning in Bogura, said two of his mills were losing an average of Tk80,000 per day due to the increase in jute prices. Not only that, the average production per day has decreased by 20 tonnes.
"A large portion of the jute sacks and twine produced in my factory are exported to neighbouring India but the decline in production has had an impact on exports," he said.
Most of the yarn produced in the two private jute mills in Rajshahi goes to Turkey, Egypt, China, as well as various countries in Europe and the US. The mills will face significant losses if they export jute products as per the prices in prior export orders.
Despite this, Rahman Jute Spinner Limited has decided to export about 9,000 tonnes of jute products in the interest of traders.
Md Fazlur Rahman, managing director of the company, said most of the yarn made in his factory for carpets is exported to various countries, including Egypt, Turkey and China.
Claiming that the company has never faced such a crisis since its inception in 2012, Fazlur Rahman said this time he has to buy jute at Tk3,200, compared to the same quality of jute, which he bought last year at Tk2,200.
I have orders from different countries to export 9,000 tonnes of jute products by December and according to current market prices, my loss per tonne will be about $150
"I have orders from different countries to export 9,000 tonnes of jute products by December and according to current market prices, my loss per tonne will be about $150," he added.
He said even if the price of jute does not increase, his will incur a loss of more than $13.50 lakh (Tk11.27 crore).
Most of the other jute products produced by Rupali Jute Mills in Dinajpur go to the domestic market, while some of the sacks and other products are exported to India.
"I have to buy the same quality jute at Tk3,000 which I bought last year at Tk2,000-2,200 per maund," said Mohammad Abdul Latif, the proprietor of the mill.
Md Mozaharul Islam, a jute farmer from Kornibari Mulbari area of Sariakandi in Bogura, said he cultivated jute on 17 bighas (561 decimals) of land this year, but due to the floods, he could not take the jute home this time.
He said most jute farmers in the area were in the same situation.
Rokon Pramanik, a jute farmer from Benipur village in the same upazila, said, "I had cultivated jute on six bighas (198 decimals) of land this time but could not take any home due to the floods. When the water suddenly rose in the River Jamuna, my jute field was submerged. After the water receded, I found that the jute was buried under the silt".
The floods have destroyed about 10,000 tonnes of jute in nine districts of the Rangpur and Bogura agricultural regions, according to officials from the Department of Agricultural Extension.
In the last 12 years, jute mill owners said that at least Tk1,000 crore has been invested in privately established jute mills in the northern region, including Bogura; from Bogura alone, jute products worth around Tk300 crore are exported to various countries, including India.
Regarding the hoarding of jute by some businessmen, district administration officials, seeking anonymity, said they had received verbal complaints about stockpiling. They said the administration would take action if they get written complaints.