Even as the farm sector is widely believed to be facing the unintended consequences of the recent currency demonetisation, ground reports of planting for the upcoming rabi harvest provide some consolation.

Three weeks after the decision to withdraw high-denomination currencies was announced, the impact on rabi planting appears rather limited.

Indeed, in the case of major rabi season field crops — wheat, pulses and oilseeds — the area planted so far is slightly ahead of last year’s. As of December 2, wheat sowing was reportedly completed on 17.4 million hectares (mh), ahead of 15.2 mh this time last year, according to the Ministry of Agriculture.

Of course, we still have some way to go before completing wheat sowing over 29-30 mh; but the progress so far is not a cause for concern.

Pulses are key

Pulses have been in the news for the last two years. The rabi harvest represents close to two-third of the annual production. Again, as of December 2, pulses have been planted on 11.3 mh, showing a 10 per cent increase over last year’s 10 mh this time. It should come as no surprise if the final planted area for pulses turns out to be around 15 mh.

Chana is the country’s dominant pulse crop, accounting for over 40 per cent of annual pulse output. Total acreage under chana or gram is usually about 9-10 mh. As of December 2, the area planted is estimated at 7.7 mh, ahead of last year’s 6.9 mh. Given that open-market chana prices have been ruling at exorbitant levels, the final acreage numbers are expected to breach the norm.

Oilseeds are no exception. Again, as of December 2, the area planted stood at 7.1 mh versus 6.4 mh this time last year, with rapeseed-mustard — the main rabi oilseed crop — planted on 6.2 mh, higher than last year’s by 12 per cent.

Despite satisfactory progress so far, concerns persist. Importantly, the pace of planting has to continue over the next two weeks so that rabi crop acreages eventually revert to the mean, if not overshoot the norm. It is unclear if demonetisation will hamper planting in the days ahead; but there is belief that the worst is over and availability of cash in rural areas is improving. The government has announced a minimum support price for various crops; but will the growers actually receive strong procurement support at harvest time?

Winter rain critical

Importantly, concerns over wheat are growing. Soil moisture conditions in the North-West region are not exactly satisfactory. So, winter rains become critical. If the India Meteorological Department forecast that winter will be mild turns out right, the day temperatures may not be cool enough for the wheat crop.

So, New Delhi must take cognisance of emerging risks to the wheat crop and take appropriate risk-management measures.

Demonetisation and its after-effects seem to have garnered everyone’s attention. The country desperately needs a large harvest of rabi crops so as to be able to contain food inflation. Close attention to the progress of rabi crops and readiness to step in with proactive initiatives is necessary.

The writer is a global agri-business and commodities specialist. The views are personal.

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