Area under agri commodities down despite revival in monsoon

Despite the revival in rainfall the area under agricultural commodities is lower compared to last year.

The area under rice, coarse cereals, pulses, oilseeds and cotton is lower this year compared to last year.

The total country-wide rainfall weighted by cropped area improved to 44% above normal, the most above normal during a week this season so far, compared with 21% above normal for the week ended September 12.

“The delay in rainfall will lower crop yields and there has also been some impact on standing crops due to heavy back-ended rains. Moreover, food inflation will rear up around the festive season esp for non-cereals where the govt does not have a huge buffer,” said Sachchidanand Shukla, senior vice president economist, at Enam Securities.

The area under rice is down by 4.5% to 36.1 million hectare, coarse cereals is also lower by  12.5% to 17.5 million ha as on September 14.

The area under pulses is down by 7.8% to 9.8 million ha, while oilseeds is down by 2.1% to 17.1 million ha.

“There have been significant improvements in rainfall in the second half of the monsoon season – but the cumulative rainfall has still been 5% below normal with about 95% of the monsoon season over. We believe this, coupled with poor distribution trends (temporal as well as spatial), will affect the summer (Kharif) crop output (harvesting for which will take place in September-October 2012),” Morgan Stanley said in a report.