The Hindu Business Line : Farm product prices may rise on decrease in kharif output

Mumbai, Oct. 2 Prices of essential commodities such as tur, urad, moong, and maize are set to rule higher during the festival season on the backdrop of strong demand and a sharp fall in kharif output.

The unfavourable weather conditions, especially during the early crop season, have affected the yield.

A sharp decline in value of the rupee against dollar will make imports of agriculture commodities almost unviable.

The rupee has depreciated 17 per cent to 46.96 from 40.26 in March. The shortfall in kharif crop may not be compensated by imports as the uncertain global economic condition will pose a major challenge, said Mr Abhijit Joshi, a Mumbai-based trader.

Pulse tab

The output of pulses in the kharif season is estimated to dip 27 per cent to 4.72 million tonnes (mt) against 6.45 mt last year, while oilseeds production will fall 10 per cent to 17.94 mt against 19.84 mt registered last year. Cereals production in the kharif season may drop 3.4 per cent to 110.61 mt against 114.51 mt recorded last year mainly due to a marginal increase of 0.5 per cent in rice output at 83.25 mt against 82.81 mt last year.

Among pulses, moong output will plunge nearly 39 per cent to 0.77 mt (1.26 mt), urad 29 per cent to 0.82 mt (1.15 mt) and tur 23 per cent 2.37 mt (3.09 mt).

Besides the lower area under kharif pulses such as tur and urad, insufficient rains in Maharashtra in the early crop season has lead to a sharp decline in output.

The area under kharif pulses has declined more than 15 per cent compared to last year.

“The lower crop estimates comes at a time when food prices have already hit historic highs and with inflation rate standing stubborn above the 12 per cent mark,” said an analyst.

Oilseeds pack

In the oilseeds pack, sunflower production will be down 30 per cent to 0.31 mt (0.50 mt), groundnut 18 per cent to 6.10 mt (7.48 mt), sesamum 29 per cent to 0.56 mt (0.79 mt), castor seed 8 per cent to 0.93 mt (1.01 mt) and niger 17 per cent to 0.10 (0.12 mt).

In fact, except for soyabean, which will record a 9.5 per cent rise in production, all oilseed output is estimated lower due to decline in area under cultivation and untimely rains in major growing areas.

Sugarcane production is also expected to dip 13 per cent to 295 mt (341 mt) due to a sharp fall in area under cane cultivation.