IMD retains above normal monsoon forecast, June temperature seen to be above normal

livemint.com:

the forecast comes as a relief after uneven precipitation and prolonged dry spell last year due to El Nino weighing on farm output that pushed up food prices and led the central bank to cut interest rates.“A normal monsoon forecast by IMD this year will bode well for Andhra Pradesh, Karnataka and Tamil Nadu, Maharashtra, Uttar Pradesh, Bihar and Odisha," Pushan Sharma, director-Research, Crisil Market Intelligence and Analytics, told Mint. However, statistically normal monsoon may not be enough and its spatial and temporal distribution will be critical. “For example, last year while monsoon was only 6% lower than LPA (long period average), its onset was delayed, and the spatial and temporal distribution was erratic.

August 2023 was one of the driest months in India’s history with rainfall 36% lower than LPA. This impacted vegetative growth for crops such as paddy, maize, pulses, okra, and tomatoes. Cotton too observed flower drops.

These crops are expected to benefit from normal and well-distributed rainfall this year," he added. Indian farms rely heavily on monsoon rainfall—with as much as 56% of the net cultivated area and 44% of food production relying on the rain. Normal rainfall leads to robust crop production, keeps a lid on food prices, especially vegetables, and bolsters growth.

Agriculture accounts for about 14% of the country’s GDP.Gross Value Added (GVA) growth of agriculture and allied sectors contracted for the first time in 19 quarters to 0.8% in the October-December quarter from 1.6% growth seen in the previous quarter. The growth rate was 5.2% in the year-ago period. In FY23, agriculture GVA growth was 4.7%, while in the first quarter of the current financial year, it was at 3.5%.