India Cuts Monsoon Forecast to 90% of Normal in Risk to Crops
(Bloomberg) -- India lowered its forecast for this year’s monsoon, a blow to farmers who are already contending with higher input costs due to the Middle East conflict.
Cumulative rains during the June-September period are likely to be 90% of the long-term average, M. Ravichandran, secretary at the Ministry of Earth Sciences, said during a news conference on Friday. The prediction carries a 4% margin of error. In April, the weather bureau had predicted that rains would be at 92% of normal.
The downturn is coming as a likely El Niño weather pattern is expected to reduce rainfall activity.
The monsoon first reaches the nation’s southern tip around June 1 before moving northward to cover the entire subcontinent over the next four to six weeks. Hundreds of millions of farmers in India, one of the world’s largest producers of rice, sugar and cotton, depend heavily on the seasonal rains to irrigate their fields.
The four-month season delivers the bulk of India’s annual rainfall and is crucial for replenishing groundwater reserves and sustaining agricultural activity. The planting period has just kicked off.
Below-average rainfall has previously prompted authorities to curb outbound shipments of some agricultural commodities to safeguard domestic supplies. The government this month banned sugar exports through Sept. 30.
Lower-than-normal rains may also force farmers to rely more heavily on diesel-powered irrigation pumps, lifting fuel demand at a time when the Iran war has already affected energy supplies. Crude oil has surged on supply disruptions and tighter flows through the Strait of Hormuz, a key transit route for Middle East exports. Domestic oil companies have already raised retail prices of gasoline and diesel this month.
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