The UN Conference on Jute and Jute Products, 2001 will meet under the auspices of UNCTAD from 12 to 13 March in order to negotiate a successor entity to the International Agreement on Jute and Jute Products, 1989. The agreement, which entered into force on 12 April 1991 for an initial period of five years, expired 11 April 2000 after two extensions of two years each.
The purpose of the new instrument will be to promote the expansion and diversification of jute trade. Jute plays an important role in such economies as India, which accounts for half of all world production (51.8% between 1996 and 1999), Bangladesh (29.9%) and China (11.3%). The share of other producer countries is relatively modest: Nepal (0.4%), Egypt (0.2%) and Indonesia (0.1%).
Although jute has largely been replaced by synthetics, interest in the product has rebounded, due to the increasing attention being paid to environmental concerns. A number of new end-uses of jute (paper and pulp, jute composites, handicrafts) are creating new opportunities. About 11 million small farmers grow jute, and hundreds of thousands of people are employed in its processing, trading and transportation.
The Conference is intended to result in a new mechanism for cooperation between jute producers and consumers, which will take the form of an international study group to ensure continued international cooperation on jute. The group will replace the International Jute Organization, which was placed in liquidation by the International Jute Council for an 18-month period beginning 12 April 2000.
Although the last UN Conference on Jute and Jute Products (Geneva, 27-31 March 2000, and Dhaka, Bangladesh, 6-8 April 2000) produced a draft agreement intended to succeed the 1989 text, the draft was never adopted.
The world jute market is subject to severe supply/price cycles. Real prices of both fibres and products have declined over the past two decades. In constantUS dollars, deflated by the IMF Agricultural Raw Materials Price Index, raw jute prices fell from US $969.70 per Mt (1990 values) in 1975 to US $357.10 per Mt (1990 values) in 1996. These reductions were not, however, offset or accompanied by improved productivity.
Between 1996 and 1999, Bangladesh accounted for 76.6% of world jute exports; India, 20.9%; and Nepal, 1.1%. China was the number-one importer, with 8.7% of world imports, followed by Japan (3.74%), Egypt (2.44%) and Indonesia (1.28%). Within the European Community, Belgium accounts for the single largest share (8.7%) of net imports, followed by the United Kingdom (4.38%), Netherlands (2.22%), France (1.94%), Germany (1.76%), Italy (1.04%) and Spain (1.01%).
As of 31 January, the International Jute Organization had 25 members, including the three largest exporting countries (Bangladesh, India and Nepal) and 22 importing countries (Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal, Spain, Sweden, United Kingdom, China, Egypt, Indonesia, Japan, Norway, Switzerland and the European Union).
