Context:
Initial independent crop estimates suggest that the production of pulses, certain coarse cereals, and groundnuts is likely to reach a three-year low. However, there is optimism for the overall output to increase by 1.5% to 4% in this season, primarily driven by higher yields of rice and cereals. Despite this, retail inflation in pulses is expected to remain elevated.
Relevance:
GS3- Major Crops – Cropping Patterns in various parts of the country, Transport and Marketing of Agricultural Produce and Issues and Related Constraints
Dimensions of the Article:
- Data related to production of crops
- Status of inflation for pulses and cereals
Data related to production of crops:
- The initial independent estimates for this year’s kharif season suggest that the production of certain crops, including pulses, some coarse cereals, and groundnuts, may reach a three-year low. However, the overall foodgrains production is expected to increase, primarily due to higher rice and cereal yields.
- Despite experiencing a monsoon season with 6% less rainfall than normal, kharif crop sowing saw a slight increase of 0.2% by the end of September. Nevertheless, crops like jute (-5.6%), pulses (-4.2%), cotton (-3%), and oilseeds (-1.6%) witnessed declines in sowing.
- The output of pulses is expected to decrease to a range of 6.9-7.3 million tonnes, compared to 8.24 million tonnes in the previous year and 7.62 million tonnes in the year before that, according to a projection by the Bank of Baroda.
- Among pulses, arhar, which saw a nearly 5% decline in sowing, is expected to experience a minor reduction from last year’s 3.31 million tonnes to a range of 3.22-3.27 million tonnes. However, the output of urad and moong pulses may witness more significant drops.
- The total foodgrains production is projected to be in the range of 158-162 million tonnes, representing a 1.5% to 4% increase over the previous year’s levels, as per the assessment by Jahnavi Prabhakar, an economist at the bank.
- She mentioned, “We anticipate an overall increase in production with crops like rice and sugarcane showing improvement. However, some drag is expected in the case of pulses, cotton, and jute.”
Status of inflation for pulses and cereals:
- Economists anticipate that retail inflation for pulses and cereals will remain high due to the less optimistic production outlook. In September, consumer cereal prices rose by 11%, while pulse inflation increased from 13% in August to 16.4%. At the wholesale level, pulse prices surged by 17.7%.
- Dipti Deshpande, principal economist at CRISIL, commented, “We expect some easing in food inflation with the kharif harvest, but there may be limited relief for pulses and cereals inflation.”
-Source: The Hindu
