July starts with healthy rainfall: Cumulative rainfall as on 6-Jul was 1% above the long-term average (LTA), while weekly rainfall (as on 3-Jul) was 32% above the LTA. Spatial divergence has reduced with most of the country receiving healthy rains during the week. North and West India (3%), Central India (-6%), East and North East India (0%), and the southern peninsula (13%) have now all had normal rains so far. With June having ended in deficit, it is imperative that July sees healthy rainfall; the month has begun on a promising note.
Sowing status better than last year: While sowing was delayed, it has now picked up and is better than last year. Total area under sowing (24.1mn ha), as on 28-Jun, is sharply higher (33% YoY) than last year. This is mainly due to accelerated sowing of pulses (2.3mn ha; 181% YoY) and oilseeds (4.3mn ha; 155% YoY). Rice sowing area is the same as last year thus far (2.3mn ha; 0% YoY), whereas sugarcane (5.7mn ha; 3% YoY) is better. Among non-food crops, cotton sowing (5.9mn ha; 63% YoY) is much higher. Overall area under sowing is at 22% of normal area sown, compared with 18.6% at the same point in 2023. July is extremely important in this regard with nearly 80% of sowing activity completed by the end of the month.
Retail food prices stay higher due to persistent heatwave conditions: Average retail prices for cereals (0.2%), vegetables (8.2%), and oils & fats (0.1%) were higher on a weekly basis, whereas pulses (0.0%) were flat and milk prices declined (-0.5%). On an annual basis as well, avg. prices for cereals (9.4%), pulses (14.0%), vegetables (39.3%), and milk (1.9%) were higher, whereas those for oils & fats (-4.3%) were lower. Delayed monsoon progress has led to persisting heatwave conditions, leading to lower supply of vegetables in particular, along with pulses and cereals. Vegetable prices may decline from August if the monsoon picks up; however, prices of milk and pulses will stay high due to tight supplies. Cereals could also see elevated prices with the government announcing a 5.4% increase in paddy MSP for the current Kharif marketing season.
Reservoir levels in deficit and below last year: The overall basin-wise reservoir levels are in deficit and below last year’s level as well. As of 3-Jul, the overall level is ~14% below the LTA and 21% below last year’s level. Most major river basins are in deficit – Ganga (North and East), Godavari (West and South), Indus (North), Kaveri (South), Mahanadi (Central and East), and Krishna (West and South). Only Narmada (Central and West) is in surplus.