Grain output to slip after poor monsoon

India's foodgrain output may drop in the foodgrain procurement season ending next month (when the 2009-10 season ends) after the weakest monsoon in more than three decades reduced rice yields.

Food grain production may total 218.2 million tonnes, 7 per cent less than the 234.5 tonnes a year earlier, according to the third advance estimate released today by the agriculture ministry. India is the biggest producer of rice and wheat after China.

The production of foodgrains, comprising wheat, rice, pulses and coarse cereals, declined mainly due to the sharp fall in the output of rice and coarse cereals by 10 per cent and 17 per cent respectively. The fall in production had occurred on account of the drought that affected nearly half the country last year.

The lightest rains since 1972 pushed up food prices in the country, prompting imports of sugar, edible oils and pulses. Data to be released on 14 May will show wholesale prices climbed 9.5 per cent in the 12 months through April, according to the median estimate of 18 economists in a Bloomberg survey.

Prices may ease with the help of a good monsoon this year, finance minister Pranab Mukherjee said today. Rains this year may be 98 per cent of the 50-year average, the India Meteorological Department said on 23 April. Farm output contributes about a fifth of the country's economic output.

Rice production may fall to 89.3 million tonnes from 99.2 million tonnes a year earlier, the farm ministry said. Wheat production may gain to 80.98 million tons from 80.68 million tonnes, it said.