Pawar : rain deficit threatens farm output

India, the world’s second-biggest rice, wheat and sugar producer, faces challenges in sustaining record food grain harvests as a 22% deficit in monsoon rain threatens planting, Agriculture Minister Sharad Pawar said yesterday. “With the monsoon playing hide and seek, it is a challenge for our farmers and scientists to maintain the food grain output achieved in the last two years,” Pawar said in New Delhi. Rainfall in July, the wettest month in India’s June-September rainy season, will be less than a 50-year average of 98% predicted in June, L S Rathore, director general of the India Meteorological Department, said. Dry weather from the US to Australia has parched fields, pushing up corn, wheat and soybean prices in Chicago on concern global supplies will be curbed. Prime Minister Manmohan Singh is counting on growth in farm output, which accounts for about 15% of gross domestic product, to curb inflation in India, where the World Bank says more than 75% of the people live on less than $2 a day. “Food inflation is still ticking up and with monsoons having so far delivered below-normal rains, there are upside risks to food inflation,” Leif Eskesen, Singapore-based chief economist for India and Southeast Asia, at HSBC Holdings Plc, said in a report. “We are only still mid-way through the summer monsoon, so there is a chance that heavier rains in the second half can eradicate the deficiency. But, there is obviously no guarantee that this will happen.” India’s headline inflation slowed to its lowest level in five months in June helped by a moderation in fuel prices, adding to pressure from business leaders for a cut both in interest rates and fuel subsidies to help revive the lacklustre economy. The wholesale price index (WPI) - India’s main inflation gauge - rose a lower-than-expected annual 7.25% in June, its slowest rise since January, following a drop in prices of some fuel items. Wholesale prices rose 7.55% in May. But a faltering monsoon, key to volatile food prices, tempered expectations of a rate cut, with the government warning inflation could accelerate without more rain. The government is ready with a contingency plan to deal with a drought, Pawar said. The country won’t ban exports of rice and wheat as it has ample stockpiles, he said. “We have not come to level where we can apprehend a drought,” Pawar said. “We will wait up to second week of August.” The government is concerned that scanty rains in Maharashtra and Karnataka and parts of Andhra Pradesh will affect sowing of summer crop this year. Food production was 235mn tonnes in 2010-11 and is expected to be over 250mn tonnes in 2011-12, officials said. Monsoon, which accounts for more than 70% of India’s annual rainfall, was 22% less than a 50-year average since June 1, the weather bureau said yesterday. The nation got 232.5mm of rainfall in the June 1 to July 15 period, compared with the 298.6mm average considered normal for the period, it said. More than 235mn farmers depend on monsoon for growing crops such as rice, peanuts, soybean and cotton. Sowing of monsoon crops begins in June and harvesting starts in September. A delay in onset of rain over some oilseed and rice growing areas has lowered sowing, according to the agriculture ministry. Rice planting dropped 19% to 9.68mn hectares this year from 12.04mn hectares a year earlier, the ministry said on July 13. Oilseeds area declined 22% to 6.77mn hectares from a year earlier, while corn was sown over 2.17mn hectares, less than the 3.13mn hectares a year earlier, it said. “There may be some deficiency in rains in July and September,” the weather bureau’s Rathore said. El Nino weather conditions, which parch parts of Asia, may emerge in August or September, he said. Rainfall in the northwestern region, the nation’s grain belt, and some parts of southern Karnataka may be deficient in the next four days, while showers may improve in the rice-growing areas in the east, Rathore said. Good showers in central India will help soybeans while deficient showers in oilseed-growing areas of Gujarat state may hurt peanut sowing, he said. Sugar cane won’t have any problem as it’s mostly irrigated, Rathore said.