July 24, 2012

India's 2012-13 major crop output may fall 0.5%

India's major crop production is anticipated to drop by 0.5%, even though the overall agriculture sector is expected to do well in 2012-13, India's economic think tank CMIE said.

Major crop production is projected to decline in 2012-13 by 0.5%, owing to a fall in output of non-food crops like soy, cotton and rapeseed, the Centre for Monitoring Indian Economy (CMIE) said in its monthly report.

India's cotton production is expected to fall by 7.8% to 32.2 million bales in 2012-13 even though the acreage rose by over 12% to 29.3 lakh hectares by June. We expect the cultivation to slow down and settle at level lower than last year. Hence, a fall in acreage is expected to limit production in 2012-13, it said.

A projected growth in output of livestock, forestry and fisheries, along with a modest 4% rise in production of minor crops, is expected to lift growth of the agriculture sector to 2.4% in 2012-13, the city-based research agency said.

Kharif cultivation of food grains and oilseeds has been sluggish due to delayed rains. In order to boost cultivation of these crops, the Centre had announced a steep increase in their minimum support price (MSP) last month.

India's Kharif cultivation of these crops is expected to pick pace in the forthcoming period, as the India Meteorological Department (IMD) has predicted normal rainfall in July-August.

Food grain is projected to scale up by 0.6% to 247.6 million tonne in 2012-13, as output of coarse grains and pulses is expected to recover, CMIE said. Coarse cereals production is projected to grow by 0.7% to 42.3 million tonne, while that of pulses by 1% to 17.7 million tonne in 2012-13.