Major Jute Nations OK Tentative Accord

Major producers and consumers of jute have provisionally adopted a new international agreement designed to improve export earnings of Third World countries.

A previously drafted text was approved at the end of a one-week conference and will be open for signing during all of 1990.

It would then enter into force for an initial five years when the current international jute agreement expires in January, 1991.

Robert van Schaagen of the Netherlands, chairman of the conference, said the Soviet Union “gave a very strong signal” that it would sign the new accord.

Although the Soviets are the world’s biggest importer of jute with a share of around 12%, they did not join the existing agreement.

The new accord, like the existing one, contained no provisions to control prices by means of stocking and market intervention.

Instead, the five countries that account for 99.6% of annual world exports of jute will receive assistance in quality improvement and marketing aimed at stabilizing and increasing demand as well as prices.

Officials said prices are improving but consumption last year of 2.9 million tons was the lowest since 1975 because of competition from synthetics, although jute has the environmental advantage of being biodegradable.