The paper investigates the nature of price variation within the crop-year or season as opposed to price variation from year to year. The seasonal price index provides a measure of the month to month variation in jute prices. It was found that, in a typical year, the actual price peak is 36% higher than the seasonal price low. There appears to be a distinct price seasonal within the crop-year, with the low occurring in August and the high in January. The period of substantive price increase, however, takes place between August and November. To exploit the upward price gradient, three early season storage plans were examined. Though the August-November storage plan to stabilize intra-crop-year prices was found to yield the highest returns, the August-January storage plan was recommended due to its lower uncertainty.

An attempt has also been made to identify theoretically and empirically, the determinants of the observed seasonal price pattern. Normally, in a crop that is harvested at one time (and consumed throughout the season) the seasonal price spread is caused by a cost of storage element and an adjustment factor due to errors in demand assessment. However, in case of jute, it was found that due to lack of adequate institutions, error in supply estimation also influences the seasonal price spread.