Below-normal September rains raise crop, inflation risks

India's southwest monsoon, which supplies over 70% of the country's annual rainfall, entered its final phase in September with forecasts of below-normal rainfall, raising concerns over kharif crop yields, food inflation, and rural demand. The India Meteorological Department (IMD) predicted that India would receive less than 91% of its long-period average (LPA) rainfall in September, based on the 1971-2020 climatological record.

Many regions, including parts of the northwest, northeast, east, east-central, and southeast peninsular India, are expected to receive rainfall below normal, while others may experience normal or above-normal precipitation.

June saw rainfall 35.4% below normal, July was 1% above normal, and August was 16.3% below normal. The country received 213.3 mm of rainfall in August, 16.6 mm below the normal of 254.9 mm. Cumulative rainfall from June to August stood at 603.7 mm, 13.8% below normal. Strong El Niño conditions, with sea surface temperature anomalies above normal, are expected to persist into September, potentially intensifying further.

Experts warn that another weak monsoon could negatively impact kharif crops, vegetables, farm incomes, rural demand, and food prices. Weak rainfall could delay rabi crop preparations and increase food inflation, particularly for vegetables and edible oils. The Reserve Bank of India (RBI) noted that a below-normal monsoon amid El Niño conditions poses risks to agriculture and rural demand. A September moisture deficit could reduce yields, impacting prices and affecting the sowing prospects for the Rabi season.