Rs 275 hike over last year; sustained policy support lifts procurement outlay

The Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, has approved a Minimum Support Price (MSP) of Rs 5,925 per quintal for Raw Jute (TD-3 grade) for the 2026-27 marketing season.

The decision marks a Rs 275 per quintal increase over the previous marketing season and reinforces the government’s commitment to ensuring remunerative returns for jute growers.

61.8 per cent Return Over Cost of Production

The newly approved MSP ensures a return of 61.8 per cent over the all-India weighted average cost of production, remaining aligned with the policy framework announced in the Union Budget 2018-19, which mandates fixing MSPs at a minimum of 1.5 times the cost of production.

At Rs 5,925 per quintal, the 2026-27 MSP continues to position jute among crops with substantial assured margins under the support price regime.

2.5x Increase Since 2014-15

The revised MSP underscores a sustained upward trajectory in price support for jute farmers over the past decade. The MSP for raw jute has risen from Rs 2,400 per quintal in 2014-15 to Rs 5,925 per quintal in 2026-27, an increase of Rs 3,525 per quintal — representing a 2.5-fold rise.

This growth reflects a broader policy thrust toward strengthening farmer income security in eastern and northeastern states where jute cultivation is concentrated.

Higher Procurement Outlay

Government support to jute growers has also expanded in fiscal terms. During the period 2014-15 to 2025-26, MSP payments to jute farmers amounted to Rs 1,342 crore, compared with Rs 441 crore during 2004-05 to 2013-14.

The significant rise in procurement outlay indicates both higher MSP levels and more active intervention to stabilise farmer incomes during market downturns.

Policy Significance

Raw jute remains a strategically important crop, supporting rural employment, natural fibre industries and eco-friendly packaging mandates. The enhanced MSP is expected to provide price assurance ahead of the upcoming marketing season, encouraging acreage stability and supporting the domestic jute value chain.

By maintaining MSP at over 1.5 times the cost of production and progressively increasing support over the past decade, the government continues to signal its intent to combine income assurance with sustainable fibre promotion.

The 2026-27 MSP decision thus reinforces both farm-level viability and the long-term positioning of jute as a key natural fibre in India’s agricultural economy.

— Suchetana Choudhury (suchetana.choudhuri@agrospectrumindia.com)