Crisil sees 3-5 percent fall in Kharif output

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Published: August 30, 2019 5:36:42 AM

Rice production is likely to fall by 7% from 102.13 million tonne in 2018-19, Crisil said.

Monsoon deficit, Kharif sowing season, Kharif output, NCML, export demand, Rice productionReleasing the Agriculture Report 2019, the agency said profits of farmers who cultivate foodgrain might increase 11-13% this year, which is lower than 15-16% growth in 2018-19.

Monsoon deficit in the crucial first one-and-half months of the Kharif-sowing season, coupled with excessive rains in August that inundated agricultural fields in several states, are likely to drag down production of foodgrain (rice, pulses and coarse cereals) this season by 3-5% from last year’s 141.71 million tonne, according to a report by Crisil Research.

Rice production is likely to fall by 7% from 102.13 million tonne in 2018-19, Crisil said. Private weather forecaster Skymet has pegged rice production at 88.66 million tonne, down 13%. The weighted average mandi prices of crops are seen to be 10% higher this year compared to last year, it said. Releasing the Agriculture Report 2019, the agency said profits of farmers who cultivate foodgrain might increase 11-13% this year, which is lower than 15-16% growth in 2018-19.

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Delayed onset of monsoon has led to a 6% decline in paddy sowing as on August 22. Though the fall in acreage has narrowed down from a high of 24% on July 5, the below-normal rains in West Bengal, country’s largest rice producer, is not going to be compensated with the subsequent rains started from mid-July.

However, the area under cotton and maize cultivation would likely raise the output of their production from the previous season. The recent spate of rainfall that caused floods in many parts of Karnataka and Maharashtra could decrease the yield of the two crops by 2% in these states, Crisil, said. While Crisil has estimated the country’s maize output to increase by 1% from last season’s 19.04 million tonne, another private agency NCML has pegged it to grow by 5.8%.

Pulses, the prices of which are a major concern to the government, are likely to be at at par with last year’s 8.59 million tonne level, Crisil said, adding tur might witness a jump in output due to higher acreage. Among the cash crops, all the agencies have predicted higher cotton production, 19-25% against last year’s 28.7 million bales (one bale weighs 170 kg) thanks to a higher acreage.

Despite higher production, prices of cotton will be robust and farmers will receive around the MSP of Rs 5,255 per quintal due to export demand, Crisil said. There is little chance of cotton reaching Rs 6,000-level (highest in 2018-19 season), it added. However, Crisil has also expressed apprehension of a drop in yield of maize and paddy due to very high-intensity rainfall in August that makes prone to pest attacks.

“The quick catch-up in southwest monsoon has meant excess rains in August in a few sub-regions. This has affected Kharif crops, particularly paddy. But abundant rains have also improved chances of healthy rabi production because of recharging of groundwater resources and higher reservoir levels,” said Dharmakirti Joshi, chief economist of Crisil.

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