The India Meteorology Department (IMD) stuck to its South-West monsoon forecast at 88 per cent of the 50-year long period average (LPA) of 89 cm. This has raised El Nino concerns from ‘weak’ to ‘moderate’.
This can affect yields of kharif crop, with a cascading effect on inflation. RBI Governor Raghuram Rajan had highlighted the risk of rising inflation in the June monetary policy review.
Food prices continue to be an issue with retail inflation touching 5.4 per cent in June, an eight-month high.
The latest forecast from the ESSO-IMD-IITM model indicates 72 per cent probability of El Nino conditions becoming strong during the remaining part of the monsoon season, said an official statement.
The El Nino phenomenon refers to the warming of Pacific Ocean waters which affects weather patterns globally. Its strengthening is likely to result in an 86 per cent probability of deficient rainfall, below the normal 94 per cent of LPA, for August and September.
The Met Department has forecast rainfall for the two months to be at 84 per cent (with a deviation of +/- 8 per cent). Rainfall in August is expected at 90 per cent (+/- 9 per cent), as forecast earlier in June.
The average rainfall for the second half is estimated at 43.5 cm, around 49 per cent of the seasonal rainfall, with variation coefficient of 15 per cent.
Could hit crop yields “Sowing has progressed fairly well but a deficient monsoon could impact yields which may put pressure of prices of pulses, fruits and vegetables,” said DK Joshi, Chief Economist, Crisil. Sowing of kharif crops at the end of July had covered 76.43 million hectares (mha), up 8.7 per cent from the 70.34 mha sown during the corresponding period of the previous year.
Between June 1 and August 3, the country received 45.03 cm of rainfall, 6 per cent lower than the normal 48.13 cm. The South, in particular, has been the worst hit with rainfall 22 per cent lower than the normal 39.82 cm.