Since 1964, raw jute futures were suspended on EIJHE, although many committees of the exchange requested the Union Government for continuation but nothing happened, as the West Bengal Government was reluctant to revive it.
Forwards Market Commission (FMC) has now allowed the East India Jute and Hessian Exchange Ltd (EIJHE) to revive raw jute futures.
Earlier in December, Jute Commissioner's office had issued that raw jute price should not exceed Rs1,468 a quintal, yet the FMC has now given permission.
Current raw jute prices is Rs1,750 a quintal but the market hopes that it would fall well below Rs1,468 a quintal in August, viewed Arun Kumar Seth, President of EIJHE.
The exchange expects trading in raw jute futures for the August delivery.
Jute industry is expecting a bumper crop this year and hence the current demand would ease out and fall in prices is eminent, hence Jute Commissioner's order can be implemented without any problem, explained Sheth.
A few years ago, FMC had permitted three commodity exchanges to start raw jute futures and now raw jute futures trading are active on the Mumbai-based NCDEX and Ahmedabad-based National Commodity Exchange.
As per the FMC directive, EIJHE made required changes in its raw jute trading bylaws and on April 7, 2006, the former first granted 'recognition' to the later to conduct futures trading in raw jute.
This progress is now attracting ring members who had earlier renounced the exchange.
EIJHE is reluctant to carry on jute goods futures trading since there is hardly any interest, as 70 percent of the jute goods are consumed by several governmental agencies, there is barely any participation from the private group, stated Sheth.
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