Bangladesh jute spinning sector sees phenomenal growth

Bangladesh’ s jute spinning industry due to rising global demand for yarn despite having a sluggish business trend in other jute goods has witnessed a phenomenal growth over the last one decade. At least 20 countries have been added in the list of export destinations of Bangladeshi jute yarn in the last one decade.

With the new ones, the product is currently exported to 89 countries. Of the total, 12 countries import a maximum volume of jute yarn, according to Bangladesh Jute Spinners Association (BJSA).

Turkey imports the highest quantity of jute yarn from Bangladesh, followed by India and China. In the fiscal year 2015-16, Turkey imported 0.17 million tonnes, India 0.1 million tonnes and China 78,000 tonnes of jute yarn from Bangladesh.

The sector saw a significant growth during the last several years, said Abul Hossain, vice-chairman of the BJSA.

Although the sector was hit hard by political turmoil in the Middle East and US-sanction against Iran, the present situation is normal and a good quantity of jute yarn is being exported to the Middle East countries.

Iran is now importing a large volume of yarn from Bangladesh which helps increase export earnings. As local supply and prices of raw jute are reasonable, jute yarn producers are doing well, he said.

The demand for jute yarn in the export market remained almost static in the last couple of years. As a result, global buyers are offering better prices of exportable jute yarn.

In the last two/three years, the demand for jute yarn did not increase, but supply increased significantly.

Other than the jute spinning mills, entrepreneurs should invest in the jute diversified products for having a growing demand in the globe. However, policy support from the government is required to help set up units for diversified jute products.

According to business insiders, nearly 60 percent of jute goods are exported from the jute spinning sector while the rest of the volume from Bangladesh Jute Mills Association (BJMA) and Bangladesh Jute Mills Corporation (BJMC)

Maximum mills came five years back when there was a boom in the jute yarn market across the globe. Many new entrepreneurs including cotton spinning millers switched to the jute spinning mills. Considering that the sector is profitable ones, banks provided loan to new entrepreneurs then.
But many of newcomers are not running their business well. Some of them closed their units.

There were a total of 97 jute spinning mills, off the total mills, 50 are performing well, 37 are under-performing while some 10 remain closed. There is a need to go for diversification of jute goods for further growth in overall jute sector.