June 9, 2009

Indian farmers may plant more of the key crops soy and pulses in the ongoing kharif sowing period between June-September due to better remuneration and government buying, experts said.

However, economists said the outlook for the farm sector will largely depend on the four-month south-west monsoon rains.

National Commodity and Derivatives Exchange chief economist Madan Sabnavis said good acreage will help output and economic growth but rainfall distribution may alter all that.

Monsoon rains, which hit the country's mainland on May 23 ahead of normal schedule of June 1, encountered a weak phase in the last week of May and early June.

Asia's third-largest economy is expecting a revival from the economic slowdown and is closely tracking the farm sector, which accounts for the livelihood of more than three-fifth of the population and one fifth of gross-domestic product.

Kharif or summer-sown crops, which accounted for 52 percent of the estimated food crop output of 229.85 million tonnes in the year to June 2009, may continue with another year of good output, helped by an expected good monsoon and good quality seeds.

Officials said higher intervention prices and active government procurement may push up paddy acreage in most states, but higher returns from cotton may cut some areas in Punjab and Haryana.

According to federal estimates, India produced a record 99.37 million tonnes of the grain last year and the government has purchased about 30 percent so far at attractive prices. India increased paddy prices by 32 percent last year.