Govt Increases MSP on Jute by Rs 315 Amid Subdued Demand in Sector

The Centre has increased the minimum support price (MSP) for raw jute by Rs 315 to Rs 5,650 per quintal for the 2025-26 marketing season. This decision by the union cabinet, is expected to provide farmers a return of 66.8% over the all India weighted average cost of production.

"Jute production is based on a variety of conditions and it is finding acceptance as a sustainable product. We have continuously encouraged farmers in jute production and we assure to buy at MSP. However, the output and production of jute will be a function of the farmer's own interest in what product gives them the best value," said commerce minister Piyush Goyal addressing the media post-cabinet meeting.

The government has increased MSP of raw jute by 2.35 times between 2014-15 and 2025-26 from Rs 2400 per quintal to Rs 5,650 per quintal.

Last year, the MSP for raw jute was increased by Rs 285, reaching Rs 5,335 per quintal for the 2024-25 season.

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India's Jute Industry

The jute industry in India supports the livelihood of around 40 Lakh farm families directly or indirectly. The number of workers employed directly in in jute mills and trade in jute stands at 4 lakh.

State-wise, West Bengal makes 82% of farmers involved in Jute production while Assam and Bihar have 9% each of jute production share.

The Jute Corporation of India (JCI) will continue as Central Government Nodal Agency to undertake Price Support Operations and the losses incurred, if any, in such operations, will be fully reimbursed by the Central Government, said ministry of agriculture and farmers welfare in a statement.

According to a PTI report, the jute industry faced a nearly 30% reduction in demand for food grains and sugar packaging bags last year. It not only trimmed working hours in mills in 2024, but also subdued prices for the finished product and the raw material affecting both millers and farmers.

Last year during the 32nd Standing Advisory Committee (SAC) meeting, industry stakeholder also informed the news agency that even as the jute industry contributes over Rs 12,000 crore to the rural economy, it is faced with challenges as raw jute prices fall below MSP levels.