Food Prices in India May Rise On Account Of Ongoing Heavy Rainfall In Several Northern States

The monsoon system has been reactivated across India, flooding many states and endangering vital summer-sown or Kharif crops, such as onion, a highly consumed price-sensitive food item.

A cyclonic distribution over the Bay of Bengal, which dumped heavy rain in West Bengal, moisture drafts due to a low-pressure formation over northern states, and a rainy trail across Gujarat, Rajasthan, Madhya Pradesh, Chhattisgarh, and Odisha have flooded large parts of several states, putting crops in jeopardy.

Rice fields in various regions of Punjab, Haryana, and parts of Uttar Pradesh have been flooded, according to growers, while Delhi had unprecedented rainfall on Saturday. A monsoon that goes into overdrive in a month when it should be slowing down may spell disaster for India's agriculture industry, which employs half of the country's population.

In an advisory issued on Saturday, the India Meteorological Department (IMD), the country's meteorological agency, warned there might be "damage to horticulture and standing crops in some places owing to flooding."

Flooding has already impacted crops in Uttarakhand, portions of Uttar Pradesh, Bihar, West Bengal, and Madhya Pradesh, after a protracted dry period from mid-June to mid-July hampered planting of summer-sown commodities such as soybean, rice, cotton, and vegetables.

Job cuts after Covid have impacted nearly one million Indians, according to data from the Centre for Monitoring Indian Economy, a private data firm.

“With unpredictable monsoons leading to an eventual harvest delay, onions, a staple in most Indian families, are going to make customers cry once more,” Crisil Ltd, a rating firm, wrote in a research note Saturday.

The primary onion-producing states are Maharashtra, Karnataka, and Andhra Pradesh, which account for approximately 75% of total summer onion output. Despite the fact that harvest is only a month away, Crisil Ltd's "on-ground report" stated that onion seed transplanting had severe delays owing to on-off rainfall, potentially delaying the maturity of the onion crop.

Summer onions make up just around 30% of India's yearly supply, but they are essential to price stability since they replace supply during the lean months of September and November. Longer dry spells followed by brief times of high rainfall, according to experts, are telltale indicators of a changing climate's influence on the monsoon, which irrigates 60% of the country's net-sown land.

“Yields may be harmed if heavy rain continues, but light rainfall in September is beneficial,” said Ashok Renjen, a former agronomist with the Punjab agriculture department.

On Saturday, the IMD forecasted “fairly widespread” rainfall with “isolated heavy to very heavy falls” in numerous states till September 14, particularly in areas of the Konkan and Goa, Maharashtra, Gujarat, Rajasthan, Madhya Pradesh, Chhattisgarh, and Odisha.

Farmers have seeded oilseeds over 17 million hectares, which is also deemed normal, according to government statistics. Rice planting is at normal levels this week, at 106 million hectares. Pulses, another important group of legumes, have been planted on 13.9 million hectares, somewhat more than usual.