06 September 2012 10:11 [Source: ICIS news]
By Ajoy K Das
The country’s Ministry of Textiles has recommend that the Jute Packaging Materials Act (JPMA) of 1987 be loosened up on concerns over possible shortage of packaging materials during the harvesting season called kharif, which will peak over the next two months, the official from the ministry said.
The ministry has taken an ad hoc measure to place orders for 350,000 bales (1.06m tonnes) of HDPE and PP woven sacks for the forthcoming crop, the official said.
Incremental demand for plastic woven sacks is estimated at 330,000 tonnes, based on estimates from the Food Corporation of India (FCI), the sole government agency for food grain procurement in the country.
The recommendation for permitting packing of food grains and sugar produced during the fiscal year ending March 2013 in woven sacks has been forwarded to the Cabinet Committee for Economic Affairs (CCEA) for a final decision, the ministry official said.
In the previous fiscal year, a mandatory usage of 100% jute packaging for foodgrains and 60% for sugar applied. But the Ministry of Textiles was given an option under JPMA to relax the rules – to the extent of 20% in case of shortage of jute sacks, according to a notification from the government agency.
The Ministry of Textile has sought government approval for a 30% dilution in the jute packaging norm, anticipating a far higher shortage during the forthcoming harvest, the official said.
FCI has drawn up plans to purchase 1.1m tonnes of jute packaging material which was almost equivalent to the total capacity of the domestic jute industry, which will not be able to cater to incremental demand.
Any additional requirement for packaging would then have to be met by the HDPE/PP industry, the source said.
However, based on past experience, the synthetic woven sack industry had often failed to deliver against government tenders for supplies of packaging material, citing time and capacity constraints, according to an official from the Indian Jute Mills Association (IJMA).
ICIS sought comments and capacity details of the synthetic woven sack industry in a query sent to the All India Flat Tape Manufacturers’ Association (AIFTMA) but failed to elicit any reply from the group.
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