Drought-hit sugar cane areas get rains, may limit damage

By Rajendra Jadhav

MUMBAI (Reuters) - India's key sugar cane producing western and southern states received ample rainfall in the first few days of the annual monsoon after nearly eight months of drought, helping to limit damage.

The states needed a prompt start and abundant rains this monsoon to ensure crops recover and output does not fall sharply below consumption in the world's biggest consumer during the 2013/14 season starting October 1.

"Rainfall in the last few days will help sugar cane to recover. Yields may be better than we had been estimating earlier," D. B. Gavit, a director at the Maharashtra Sugar Commissioner's office, said.

After a drought in 2009, sugar production fell sharply, forcing India to make big purchases from overseas markets and pushing the price of raw sugar futures to 30-year highs.

The cane crop in the country's biggest producer, Maharashtra, and the third and fourth-biggest producers Karnataka and Tamil Nadu in the south, was badly hurt due to poor rainfall in 2012 and in some areas the crop wilted.

These three states account for more than half of India's total production, which is estimated at 24.6 million tonnes in 2012/13.

Sugar cane is a perennial, water-intensive crop and is usually harvested 10 to 16 months after planting. Cane for the crushing season starting October 1 has been planted, but half the total acreage was short of water during April and May.

"There was a sharp drop in acreage for 2013/14 due to water scarcity. That loss can't be recovered. Rainfall will allow farmers to plant cane from July onwards, but that crop will be available for crushing only in 2014/15," Gavit said.

The monsoon has already covered Tamil Nadu, most parts of Karnataka and the southern part of Maharashtra state, nearly three days in advance, the weather department said on Wednesday.

Monsoon rains, which run from June to September, are vital for the 55 percent of farmland without irrigation in India, one of the world's largest producers and consumers of food.

"We are getting reports of ample rainfall in cane growing areas of northern Karnataka. Certainly it will help the crop," said an official at the state's farm department, who declined to be named.

The drought had hit cultivation of the water-intensive crop. Farmers have cane on 4.12 million hectares as on May 31, down 10 percent compared with the same period a year ago, farm ministry data showed.

"The planting pace in Maharashtra was worrying ... If the monsoon spread is normal, then the planting for the crushing season 2014/15 should move without any problems," said Ashwini Bansod, a senior analyst at Phillip Commodities India Pvt Ltd. (Editing by Jo Winterbottom and Jukwey)