India's milled rice production to decline by 6%: Emkay
Emaky has come out with its report on agri sector. According to the research firm, the Food & Agriculture Organisation (FAO) has said that India's milled rice production is expected to decline 6% to 98.5mn mt in the current kharif season due to late onset of monsoon.
September 10, 2012 / 11:28 IST
Emaky Commodity Research has come out with its report on crops. According to the research firm, the Food and Agriculture Organisation (FAO) has said that India's milled rice production is expected to decline 6% to 98.5mn mt in the current kharif season due to late onset of monsoon. Delay in monsoons has led to rains being deficit in key northern and southern growing areas.
- Led by gradual pickup in monsoons, overall monsoon deficit declined to 12% from 17% a fortnight ago. As per IMD, this year's monsoon is better than 2009 which witnessed deficient rains in every month & deficit stood at 22%.
- Sowing patterns have improved drastically with the pick-up in monsoons. Area sown under coarse cereals which were deficient by 22% last month declined to 15% & area sown under pulses which were deficient by 20% declined to 4%.
- Crop prices which had increased sharply during July’12 remained stable during Aug’12. Agri-inputs consumption continues to remain weak.
- With water level in reservoirs reaching comfortable levels, rabi planting is unlikely to be impacted. However, kharif crop yields are likely to be impacted due to delay in sowing, uneven distribution of rainfall & lower agri-input consumption.
Rainfall deficit down to 12%; IMD says this year's monsoon is better than the 2009 drought Though June/July 2012 witnessed dry spells of rain, however monsoons picked up pace in August & have been able to cut down the overall monsoon deficit to 12% currently from 30% in July. Indian Meteorological Department (IMD) expects this year's rainfall deficiency to drop further with rains in first week of September expected to be good. Further, IMD has also said that there has been no impact of El Nino on the monsoon till now. IMD has also stated that this year's monsoon is better than the 2009 drought year as in 2009, rains were deficient every month and the overall deficiency was 22%. Sowing patterns improve due to revival of monsoons Though delay in the onset of monsoons impacted initial sowing patterns across crops, however gradual pick-up in monsoons accelerated sowing activities & helped to partially mitigate the drop in crop acreages. Data provided by the Dept of Agri indicates that with improvement in monsoons, sowing activities also improved considerably. Area sown under coarse cereals which were deficient by 22% (compared to normal area) on 9th August-12 declined to 15% on 31st Aug-12 while area sown under pulses which were deficient by 20% last month declined to 4% on 31st Aug’12. Area sown under paddy has increased to 5% above normal area on 31st August 12 compared to deficiency of 3% on 9th Aug’12. Rabi unlikely to be impacted; watch out for kharif crop yieldsTotal live storage in 84 important reservoirs in different parts of the country, monitored by CWC as on 30th August 2012 stood at 100.831bcm, which is 65% of the storage capacity at Full Reservoir Level. The current year's storage is nearly 83 % of last year's storage and 102 % of the average of last ten years. Out of 84 reservoirs, 55 reservoirs reported more than 80% of normal storage & 29 reservoirs reported 80% or below of normal storage. Though situation has improved & rabi planting is unlikely to be impacted due to comfortable reservoir levels, however kharif yields are likely to be impacted due to delay in sowing, uneven distribution of rainfall & lower agri-input consumption. Crop prices remain rangebound in Aug-12 Market prices of key crops increased in the range of 2%-10% MoM during Aug’12. Emkay Crop Index which tracks prices of 10 key crops increased 22% yoy/4% MoM. Wheat prices increased by 10% MoM in Aug’12 as despite record procurement of wheat from Punjab and Haryana this year, flour mills and biscuit makers in both these states are facing severe shortage of wheat. The supply of 1.65 lakh mt of wheat by Food Corporation of India (FCI) under Open Market Sales Scheme (OMSS) for July, August and September was exhausted in the first month itself. Urad prices increased by 5% MoM during Aug’12 while maize increased by 4%. However, jowar prices declined by 4% MoM. Gradual pick-up in monsoons accelerates sowing activities Though June/July 2012 witnessed dry spells of rain, however monsoons picked up pace in August. Consequently, overall monsoon deficit is down to 12% currently from 30% in July’12. While delay in the onset of monsoons impacted initial sowing patterns across crops, however gradual pick-up in monsoons accelerated sowing activities and helped to partially mitigate the drop in crop acreages.Ministry of Agriculture prepares contingency plan to tackle drought like situation The Ministry of Agriculture has prepared contingency plans for 353 districts across the country for implementing location specific interventions to sustain agriculture production. Subsidy on seeds has been enhanced to partially recompensate the farmers for the expenditure in re-sowing and/or purchasing drought tolerant variety of seeds. States which have received deficient rainfalls like Punjab, Haryana & Uttar Pradesh have been allocated with additional power from Central Pool. Govt. has also introduced Diesel Subsidy Scheme to offset the cost of diesel used for pumping water for irrigation to standing crops in drought affected areas. Further, the Reserve Bank of India (RBI) has issued standing guidelines to banks for providing relief to the farmers in drought- affected areas.Govt. launches special plan to produce 19+ mn mt of pulses in kharif this yearThe govt. has launched a special plan to achieve 19+ mn mt of pulses production in 16 States during kharif 2012. The plan envisages utilization of new areas through intercropping, improving planting techniques & irrigation use efficiency for inclusive water management & use of low cost inputs like sulphur and weedicides.Production of vegetables/fruits rise by 3%/1% yoy in FY12 Production of vegetables in India rose by 3% to 150.59mn mt during FY12, while that of fruits was marginally up by 1% at 75.27mn mt in the same period. For FY11, India had produced 146.55mn mt of vegetables and 74.88mn mt of fruits.FAO says India's milled rice production is expected to decline 6% during this kharif- United Nation's body, The Food and Agriculture Organisation (FAO) has said that India's milled rice production is expected to decline 6% to 98.5mn mt in the current kharif season due to late onset of monsoon. Delay in monsoons has led to rains being deficit in key northern and southern growing areas. Production from the kharif season amounts to about 53% of the total annual cereal output and about 88% of the main staple, rice.Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.To read the full report click on the attachment 
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