Changes in Marketing System of Raw Jute in Bangladesh

Abstract

The study examined the changes in raw jute marketing system in Bangladesh. Ten primary and two secondary markets were selected purposively from five intensive jute growing and two jute trading areas of the country, respectively during 2010-11. Between two terminal markets, annual arrival of raw jute was found higher in Khulna (Daulatpur) than that of Narayanganj. Most of the total raw jute is exported through Chittagong and Mongla sea ports of the country. The study identified five major channels and channel-IV (Producers–kutcha balers–pucca balers cum exporters) had the highest efficiency based on six performance indicators. The mode of payment for raw jute trading was mostly dependent on credit system with higher pay off period. None of the selected farmers sold any raw jute to the government purchase centres during the study periods. The number of licensed ‘dealer of jute’ as well as kutcha and pucca presses have increased over the years. The study identified more markets participants involved in the raw jute marketing system over the previous study. In terms of profit (net margin) making, the performance of the millers and the farias was relatively better than that of other participants. Marketing costs and margins have increased over the years, but their net margins as percentage of total investment were not much higher. The existing raw jute marketing system can be identified an efficient system in terms of producers’ share of the consumers’ prices, which was 39% higher over the previous study. The study showed higher seasonal variability and deviation in raw jute prices in the study area. Therefore, government should establish more storage facilities at intensive jute cultivation areas with private participation in order to store enough jute. Moreover, raw jute should be purchased directly from jute growers throughout the year under public procurement programme with minimum support price.