Excess early rains boost sowing trend

The June-September monsoon covered two-thirds of the country a fortnight earlier than usual on June 13, according to the India Meteorological Department

A bountiful monsoon has bolstered sowing of a range of kharif or summer-sown crops, which is progressing at a quicker pace compared to previous two years and is likely to keep farm growth on track and help tame rising inflation, a major concern across economies, including India, experts have said. The government expects a third straight year of record harvests, an official said, requesting anonymity. Early monsoon rains have boosted sowing of crops such as rice, cotton, soybean, maize and pulses in southern, central and western states. In northern states, too, sowing has accelerated.

Overall, planting of summer crops this year has been higher by nearly 38% than the previous year. (Sameer Sehgal/HT)

Global inflation, especially of crude and edible oil, can still stoke prices in the country. However, bountiful farm output and a normal monsoon will keep a lid on prices of foods that don’t need to be imported, forecasters said. Poorer households tend to spend more on food as a proportion of their monthly budgets than on other items.

The June-September monsoon covered two-thirds of the country a fortnight earlier than usual on June 13, according to the India Meteorological Department (IMD), which said the rain-bearing system was well on course to advance into the northwestern states, albeit with a bit of a lull. The rains have been 33% excess so far. Good rainfall also tends to increase yields.

Overall, planting of summer crops this year has been higher by nearly 38% than the previous year, according to weekly sowing data filed by states. Compared to 2019 levels during the corresponding period, sowing is higher by nearly 24%.

Robust farm output is key to Indian economy because nearly half of all Indians depend on a farm-derived income. Over 50% of India’s net-sown area lacks access to irrigation. “One of the reasons for brisk sowing activity is that farmers in many states took to early sowing because of good pre-monsoon showers,” said Abhishek Agrawal, an analyst with Comtrade, a commodities trading firm.

Good harvests boost demand for manufactured goods and services. “The rise in inflation has been very broad based and that’s a worry. There are new drivers of inflation. Inflation in imported items, like crude oil and edible oil, is not in our control,” said DK Joshi, the chief economist of Crisil Ltd, a ratings firm. However, the “important part” is that overall food output is likely to be good and “so we are unlikely to see inflation in most food items rising in a substantial way”, Joshi added.

GDP growth and prices continue to be two key concerns of the economy as it tries to claw out of the pandemic, said KS Mani, an economist. Retail inflation rose to 6.3% in May 2021 from a year ago, higher than the Reserve Bank’s acceptable upper limit of 6%. Inflation in food and beverages rose 5.24%, led by edible oils and pulses.

Farm growth stood at 3.1% in fourth quarter compared to 4.5% in third quarter in FY 21. It grew a healthy 3.6% for the full year, cushioning the impact of Covid on the economy somewhat.

The country’s foodgrain output is projected to rise 2.6% to stand at a record 305.43 million tonnes in 2020-21, according to estimates of the agriculture ministry released on May 26.

In the states of Karnataka, Tamil Nadu and Kerala, rice plantings are up by nearly 100% so far, data from the states show.

“A key sowing trend this year is a sharp increase in the sowing of pulses,” the official cited in the first instance said. In the first week of May, a month ahead of the monsoon’s onset, the higher sowing trends had already become apparent.

In the last week of April, for instance, the area sown under pulses had increased to 1.2 million hectare, which is a nearly 100% jump for that period.