August 24, 2009

India will aim to increase this year's winter-crop output, partly aided by a late burst of rains, to offset a likely slump in production from a dry summer in decades that threatens to boost foodgrain prices.

 

Farm Minister Sharad Pawar told a conference of state agriculture ministers Friday that the government has started preparations to ensure the timely sowing of wheat, a staple grain, along with other crops.

 

"I anticipate early and higher coverage of winter-sown crops this year," Pawar said. "This is a good opportunity to ensure that wheat is sown in time."

 

India's annual monsoon rain, 26 percent below the 50-year average in the June 1-Aug. 19 period, is expected to lower the output of rice, another staple crop, given that sowing is down 15 percent compared with a year ago. Still, the late revival of rains in the biggest growing areas may help make up some of the loss because soil moisture is likely to increase.

 

Earlier this week, Pawar predicted the summer-sown rice harvest would fall by about 10 million tonnes.

 

"We can partly make up the deficit with the winter crop," T. Nandkumar, federal farm secretary said. India harvested 99.15 million tonnes of rice in fiscal 2008-09, of which 84.58 million tonnes was of the summer-sown variety.

 

"There is a need to take up intensive campaign in the eastern region for ensuring that farmers are able to sow their wheat in time, by Nov. 15," he said.

 

The government will also attempt to sow wheat over a higher area this year, in regions such as the eastern part of Uttar Pradesh and the states of Bihar and West Bengal, Pawar said.

 

Wheat is typically sown in October-November, soon after summer crops, including rice, pulses and sugar cane, are harvested.

 

Pawar also said the weather outlook for the winter crop, sowing of which will start in October, was encouraging. The India Meteorological Department has forecast a good amount of rainfall in its initial reports, he said.

 

The late rains in the past five to seven days over the northern region, the country's grain bowl, have also helped limit some of the earlier damage to the crops.

 

Some of the states have been 60 percent deficient since the start of the season in June. The four-month monsoon season is crucial as 60 percent of the country's farmlands are rain-fed.

 

With crop output expected to fall on meagre rains during the first two months of the sowing season that started June 1, the government has decided to continue with foodgrain export ban.

 

However, at meeting of ministers earlier this week, the government lowered the floor export price for basmati or aromatic rice to US$800/tonne from US$1,100/tonne. Lowering of the floor export price would help Indian basmati exporters to sell cheaper varieties of aromatic rice in overseas markets.

 

The farm minister also expressed concern over the sugar cane crop, as rains have been deficient in Uttar Pradesh, the country's second-largest producer.

 

India is facing a shortage of sugar as output is estimated to fall to about 15 million tonnes in the year to September from 26.3 million tonnes a year earlier. Its annual demand is 22 million-22.5 million tonnes.

 

This situation is likely to prolong for at least another year because of the poor rains.

 

The government will try to check a rise in sugar prices, which have soared 30 percent in the last six months, Pawar said.

 

India has already relaxed norms for the import of tax-free white and raw sugar. It has also cracked down on hoarding by imposing stock limits on the quantity of sugar a trader or a company can hold.