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Finally, the monsoon is here!

Author: Veeresh Hiremath/Wednesday, June 6, 2018/Categories: Commodities

Finally, the monsoon is here!

Southwest monsoon set its first footprint over the country on May 29, three days ahead of the normal onset date. According to IMD's 2nd Long range monsoon forecast, rainfall is forecasted to be Normal (96% to 104% of LPA); further, monthly rainfall over the country as a whole is likely to be 101% of its LPA during July and 94% of LPA during August. IMD has also released region wise forecast; 100% of LPA rainfall is likely in Northwest India while in Central India, rainfall is likely to be 99% of LPA. However, rainfall in South Peninsula and North-East India is forecasted to be lower than normal with 95% and 93% of LPA respectively.  Let us understand how this monsoon will have its important on various crops.   

Sowing Prospects of major crops

Cotton: Normal monsoon forecast for central and northern region will not only boost up the productivity of cotton but also impact the yield of cotton positively.  Good rainfall has been always helpful for cotton cultivation as cotton require much water for crop progress. Cotton planting has already commenced in northern region but it will pick up once the monsoon reach in central region. As per the initial planting intention of farmers, crop shifting could be seen from cotton to soybean in Maharashtra due to lower yield realisation in cotton as larger part of cotton crop in Maharashtra was infested with pink boll worm pest attack. Cotton Association of India estimated total cotton acreages in India for year 2018-19 may fall up to 108 lakh Hac, lower by 12% compare to last year.

Soybean: Soybean is likely to be hot pick to the farmers in central region due to its better return among major kharif crops which are sown in this region. Apart from that farmers in northwest region may prefer soybean over pulses due to higher return.  Furthermore, spread of monsoon could be crucial for planting activities and early onset of southwest monsoon in Kerala could be good indication for commencement of sowing activities. IMD has projected normal monsoon for central and northwest region which may spur farmers to enlarge their area under soybean as soybean yield has good correlation with amount of monsoon rainfall. Overall area under soybean could increase by at least by 10%-15% may be recorded in between 115 -120 lakh hac for year 2017-18.

Guar Seed: Guar seed in the kharif grown crop and is very much sensitive to the monsoon. Since the guar seed is grown in western Rajasthan, the amount of rainfall and its distribution plays major role in deciding acreage under guar cultivation. Guar growing region receives the rainfall in the month of July, hence, early onset is raising hopes of early entry into monsoon which means early sowing of guar. Looking into current market price, we are expecting drop in guar acreage as farmers are likely to shift to other remunerative crops.

Turmeric: During the last season, turmeric failed to give the expected returns to the farmers who were already stressed with lower production. IMD has forecasted monsoon rainfall over the country to be 97% of the LPA; however expectations of 95% of LPA rainfall in South Peninsula is definite to cast some concerns on the yield levels if not for the sowing acreage. South Peninsula consists of major turmeric growing states of Telangana, Andhra Pradesh, Tamil Nadu and Karnataka. Hence, considering various factors, we expect acreage under turmeric to increase slightly by 10-15% Y/Y.

The author is DGM, Karvy Comtrade Ltd

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