Lower sowing to hit kharif output this year

Kharif 2019 may end up as one of the most difficult seasons for farmers. A number of crops are hit as unpredictable weather changes have resulted in lower sowings, thereby increasing the possibility of lower agricultural output this year.

The government estimates have put kharif crop acreage almost the same as last year. If the yield is high, the production could be even higher than the previous years.

But according to data collected by us at Agrisk Data Analytics, overall kharif crop acreage of soybean is down a whopping 33%, groundnut 15% and cotton 14%. However, the acreage of toor (pigeon pea) and maize are just about the same as last year. The lower acreages could mean lower production and therefore it might cause wild swings in the prices of these commodities.

Though we have done studies for nine principal commodities including wheat and rice, in this article I would largely be dealing with soybean, cotton, groundnut and maize for the seven states of Gujarat, Maharashtra, Andhra Pradesh, Telangana, Karnataka, Rajasthan and Madhya Pradesh.

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One of the reasons the initial estimates of the government could have gone wide off the mark is variations in rainfall. As of October 9, the rainfall for the country as a whole this season compared to last year has been the same – at 32.5 mm. But the distribution was unequal. In northwest India the Long Period Average of rainfall was 103% over the previous year. Central India was up 15%. The southern peninsula and east and northeast India witnessed a shortfall of 12% and 28% respectively.

While the government releases crop sowing area after the season, these numbers are updated regularly. Later after the production, they release those numbers as well. The initial figures are later revised based on input from the field officers.

We at Agrisk adopt a different and more granular methodology. We speak to farmers and find out “their intention to sow”. This exercise is conducted in June for kharif. We then find out “sowing status” by comparing planting intentions with previous year’s sowing. By August we came out with completion status by comparing “status of sowing” with “intention of sowing”. We then look at “crop abandonment”, which means the acreage which might have been reduced by the farmer due to change in weather conditions — for instance if it rained heavily, some of the sown areas may have to be abandoned. Finally, by September we come out with sown area this year by comparing it with the sown area last year.

Early this year the agriculture season started on a grim note as there were expectations of lower rainfall. Farmers, therefore, lowered their planting intentions and sowed on a lower acreage. Unexpected heavy rains in some of the areas added to their woes and resulted in further losses.

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As we monitored kharif 2019 we noticed many swings in the mood of the farmers and it had cast a shadow over their decision-making process. Given the vagaries of the weather, there was a sense of pessimism in the mood of the farmers. This was evident from the Planting Intention or PI numbers which essentially tell us what the farmer was planning to sow.

In Karnataka, farmers were almost staying away from most of the crops around June end and early July as there were no signs of rains. The sowing intention was lower 46% for cotton, 25% for groundnut, 11.5% for maize and 14.56% for soybean.

However, farmers in Maharashtra were slightly optimistic as monsoon had started by then and early showers had kindled a ray of hope in them to sow more soybean this year as compared to the previous one. The sowing was 3.93% higher for soybean, 5.6% for cotton and 11% for maize. But it was negative for groundnut and the acreage fell by nearly 10% as government lifted import restrictions.

In Madhya Pradesh, farmers this year were planning to sow over a 5% lower area as compared to the previous season since the prices had remained more or less steady. They went ahead with 4% less sowing but were hit by unexpected heavy rains. The Malwa region was literally inundated and as a result the farmers had to abandon 24% of crops overall in the state. This translated into 33% lower acreage as compared to last year.

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Therefore, by early July, Agrisk had a better insight on the overall soybean story. We concluded that the crop was sliding downwards. We had estimated this much before the start of the monsoon mayhem.

Along with soybean, overall cotton acreages too went down by 9%. But  maize went in the opposite direction and closed at higher acreage of about 33%.

A key thing which needs to be examined is that if there were large changes in the area of crop under sowing due to unpredictable weather which was that one crop that managed to get the maximum advantage?

In Karnataka, Telangana and Andhra Pradesh cropping patterns have remained more or less steady. Farmers have not moved away from traditional crops which they are used to. But what is to be seen is how they would handle the situation next year. There could be marginal increases in area under soybean and cotton.

Oil companies would be looking at the yields of soybean crop followed by groundnut and cotton. In Madhya Pradesh, there are early signs of lower yields and this would get confirmed in the next few days.

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However, the silver lining is that heavy rainfall across the region has led to higher soil moisture which is extremely potent for the upcoming rabi crop. This could see a bumper yield (only if rain does not play spoilsport in February when crops get harvested).

So given the lower potential of oil seeds production, does it call for higher imports? Well the market buzz is that there could be a lower demand for oil and hence there may not be any need for imports even if the domestic production is not so great.

A final word of caution, our (Agrisk) numbers differ from the rest since our methodology and the base assumed is different. We do not use any official figures provided by the government to build our estimates. We develop our own base numbers at the district level and then build state and national scenarios over it.

(Ravishankar Mantha is the chief executive officer of Agrisk Data Analytics)