Lag in Kharif sowing raise concerns for Agri growth

NEW DELHI: Unfavourable distribution of monsoon rainfall so far along with subdued pace of kharif sowing has raised concerns over the outlook for agriculture yields, food prices and rural sentiment, according to investment information and rating agency ICRA.

The initial trends of southwest monsoon have been largely unsatisfactory with a delayed onset over Indian sub-continent and sub-normal rainfall during the first month of the season. Till June-end, the rainfall was 67 per cent of long-period average (LPA). Weak El Nino conditions over Pacific Ocean coupled with cyclone Vayu in Arabian sea impeded the progress.

While weekly volumes oscillated between excess and deficit in July, cumulative rainfall during the month stood at 104.6 per cent of LPA which was substantially higher than the India Meteorological Department’s (IMD’s) forecast of 95 per cent. Flooding occurred in some states in which there was a sub-optimal outcome.

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Overall, the volume of rainfall during June and July was considerably below normal at 90.8 per cent of LPA, led primarily by a significant shortfall in June.

As many as 14 subdivisions received deficient rainfall — Gangetic West Bengal; Jharkhand; West Uttar Pradesh; Uttarakhand; Haryana, Chandigarh and Delhi; Himachal Pradesh; Odisha; Gujarat region; Saurashtra and Kutch; Marathwada; Telangana; Tamil Nadu, Puducherry and Karaikal; South Interior Karnataka; and Kerala and Mahe.

“This is likely to have an adverse impact on agricultural output and incomes in these regions. Moreover, some districts in Assam and Bihar have reported heavy flooding in the recent weeks which may also dampen the outlook of crop output in these areas,” said ICRA adding that temporal distribution has been unfavourable with a low 26 per cent of instances of normal rainfall across the sub-divisions on a weekly basis.

The total area sown till July 26 stood at 68.9 million hectares which was equivalent to 65 per cent of the final kharif area in 2018 and represented a year-on-year decline of 6.5 per cent, mirroring the below-average monsoon precipitation in June and July.

Kharif sowing till July 26 lagged the year-ago levels for major crops like rice (minus 6.4 per cent), pulses (minus 18.6 per cent), coarse cereals (minus 8.9 per cent), oilseeds (minus 5.2 per cent), jute and mesta (minus 5 per cent) and sugarcane (minus 5.7 per cent). However, the areas sown under cotton exceeded the year ago levels by 6.3 per cent.

The IMD expects the volume of rainfall to improve significantly over coming weeks on account of Indian Ocean Dipole turning positive and the threat of El Nino having passed. Farmers may opt to take advantage of this pickup in rainfall to sow short-duration varieties of various crops which will boost the overall area covered under kharif crops.

“However, the late pickup in sowing is likely to weigh upon yields. This may also have some impact on food prices which is an emerging concern related to the outlook for food inflation,” said ICRA. “Overall, based on the available data, we expect a subdued growth of farm incomes from the kharif season, which is likely to weigh upon rural sentiment and consumption demand,” it said.

Regardless, a normal temporal and spatial distribution of rainfall in the last two months of monsoon season, as well as a timely withdrawal of the monsoon, will be crucial to bolster yields and prevent crop damage. It will be crucial also for the replenishment of reservoir storage as well as groundwater levels, and thereby influence the outlook for upcoming rabi season.

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