Posts Tagged ‘rainfall’

Rabi Crops Get a Lifeline on Late Rains :)

Lets Get to know of the latest Agri updates in the country 😀

agri-update-smc

Rabi Crops Get a Lifeline on Late Rains:

Considering cumulative rainfall from June to September, expected retention of moisture in soil between October and December, and recharge in the ground water level, the agriculture ministry expects no major dip in the coverage of food crops in the coming rabi season.

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As for other rabi crops in 2009, the ministry sets the rice production target at 14.5 mt, for jowar at 3.9 mt and barley at 1.6 mt, which are almost similar to the last year’s level.

According to the fourth round of estimate by the ministry, rice production in the last rabi season was 14.6 mt, barley 1.5 mt and jowar 4.2 mt.

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At the same time, it has asked all wheat growing states to ensure that sowing of wheat is completed by the end of November and to see that maximum areas are covered with high yielding and high temperature tolerant varieties.

In Other major Agri Updates we can see that Monsoon has withdrawn and has left 22% shortfall in the country.

An erratic monsoon, which left the country 22 per cent short of normal seasonal rainfall and caused concern about the kharif harvest, has finally begun to withdraw, almost three weeks later than normal.

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The total monsoon rainfall this year till September 23 was estimated by the IMD at 66.83 cm, about 22 per cent below the normal level of 85.87 cm for the period.

According to the India Meteorological Department (IMD), the withdrawal line today passed through Ganganagar, Churu, Jodhpur and Barmer in Rajasthan.

However, many other parts of the country will still continue to get rain.

The maximum deficiency is in the north-west (34 per cent), followed by the north-east (25 per cent), central India (19 per cent) and southern peninsula (8 per cent).

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Monsoon Deficit Narrows But Just Slightly

monsoon deficit

The rainfall in India seems to have improved a little with the monsoon shortage being at 28% below average for the week ended August 16.

While as on August 12, the overall rainfall in the country was 29% below normal.

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However, rainfall during June 1 to August 16 was at 434.6 mm against the historical average of 602.1 mm while the rainfall in the northwest was 40% below average as on August 16 while in northeast it eased slightly to 32%.

However, the shortfall in central India increased to 21%.

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The Impact Of Significant Below Normal Monsoon:

The current situation definitely does not bode well for the agriculture output.

While in the past, the drought like situation has severely impacted the economic growth (1%-2%), this time the impact could be lower due to:

1. Agri contribution to the overall GDP has been coming down and now stands at ~17% (v/s > 45% in 1970s and > 30% in 1990s)

2. Irrigated land to total land ratio has been improving,

3. National Rural Employment Guarantee Scheme (NREGS) and Farm loan waiver,

4. Significant increase in budgetary allocation to rural development.

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However, if the overall monsoon remains 20-25% below normal and the spatial distribution does not improve, it is likely that FY10 GDP forecasts may be revised downward by 50-100bps.

Increased spending by the Govt and faster implementation of some of the infrastructure projects may limit the damage to ex-agri GDP growth as mentioned above.

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However, Worst affected monsoon deficit areas will have problems of food availability, employment, and drinking water.

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Moreover, India is at a risk of 60-100 basis points drop in GDP growth forecast of 6.4% for FY 2010 while agriculture growth is decreasing by around 5-8% in the current fiscal.

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In addition, rice production during the kharif season this year may decrease by about 10 million tonnes due to declining monsoon in the country while it produced nearly 100 million tonnes of rice in both rabi and kharif seasons in 2008-09.

However, some shortage in production of oilseeds and sugarcane is also expected.

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However, macroeconomic consequences may not be very serious due to the weak monsoon owing to the reasons stated above.

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The Impact Of Significant Below Normal Monsoon:

D-Street may inch towards consolidation: Analysts

Dalal Street

A wave of consolidation is likely to greet Dalal Street this week as concerns over rainfall shortage would pull down investor sentiments and keep the market under pressure, analysts said.

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“The market would remain range-bound and would look for a positive trigger amid the dampening effect on the possibility of a drought-like situation in the country,” Ashika Stock Brokers Research Head Paras Bothra said.

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Analysts also said there might be some positive bias in the movement of the market but absence of any major trigger might shift focus on the rain God.

“Delayed monsoon has made the market totally indecisive of the next move.

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The impact of drought would be felt in some time from now and that is holding back investor confidence to enter market,” SMC Capitals Equity head Jagannadham Thunguntla said.

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Besides, with the US economy showing signs of revival and Germany and France emerging out of the recession quicker than expected, analysts feel it could bring in a positive bias in the market.

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“As it is now a known fact that the major economies are pulling themselves out of the recession, I do not foresee any major collapse in the market in near term as it is all positive news around,” Bothra added.

The BSE Sensex gained 251 points, or 1.66 percent in the past week and closed at 15,411.63 points.

A monsoon hit to the economy!

A monsoon hit to the economy!

With every passing day, hopes of a normal monsoon are receding.

Along with poor rainfall, hopes of better economic performance in 2009, too, may suffer a washout.The situation is one of concern.

Everyone now has fingers crossed about the next crucial 20 days. Surely, instead of see-sawing between hope and despair each time rains play truant, India ought to deal with the problem of its monsoon-dependence scientifically.

Representing around 17 per cent of India’s GDP, agriculture has averaged nearly 4 per cent growth over five years.The sector was expected to buoy India’s overall growth, hit by the global crisis.

Manufacturing is down. Exports are down. If the monsoon does disappoint, farm production will fall at about the worst possible time.

Nearly 70 per cent of Indians depend on farming. Many handling summer-sown crops like rice, soybean, sugarcane and cotton would be impacted, as also dealers in food and cash crops.

Rural demand has been robust. A poor monsoon could change that. Food prices are already high. They could hit the roof. Within the WPI, the food articles inflation stood at 8.65%.  Inflation for sugar and sugar products stood at a whopping 33.29%.  Poor rainfall will ensure that this problem continues.

Irrespective of how the situation plays out, studies on monsoon patterns indicate a generally erratic and weakening trend.Yet India’s output of water-intensive crops is to grow exponentially in future, implying massive groundwater depletion in wheat and rice-growing states.

Managing water resources – harvesting, extraction, storage or recycling – can’t but be top priority. Woefully inadequate irrigation infrastructure needs overhaul.

India can learn a lot from technologically innovative Israel, a model of efficient water management. Consider drip irrigation, which avoids evaporation by keeping the soil moist underground.

Also, power subsidies encourage waste of water. Their calibrated rollback is required, as also strict use of water meters.

Finally, there’s need to boost manufacturing to meet growth targets and ease dependence on agriculture.

By World Bank estimates, our water demand will outstrip supply by 2020. Staving off such a scenario will require more than propitiating the rain gods.

It is Need of hour that India’s dependence on the monsoons has to be cut down and minimized.