Bountiful monsoon rains set to boost India's agriculture growth

[MUMBAI] India's farm sector growth will likely be the highest in three years as better-than-normal rain helped farmers to boost output of crops, including rice, sugar cane and soybeans.

Agriculture growth in the year that began in April will surpass the 4 per cent level achieved in 2019-20, said Atul Chaturvedi, president of the Solvent Extractors' Association of India. That would be the highest since 2017-18 when the sector grew by 5.9 per cent, according to government data.

"With good rains and good monsoon, the harvesting has taken place brilliantly, and consumption as far as the rural sector is concerned has also increased," Mr Chaturvedi, who is also the executive chairman of India's top refiner Shree Renuka Sugars Ltd, said in a Bloomberg Television interview on Tuesday. When the wider economy is not doing that well, "agriculture is probably the only silver lining." India's sugar cane production is seen rising to almost 400 million tons in 2020-21 from 355.7 million tons a year earlier, according to the farm ministry. Output of monsoon-sown food grains, including rice, is set to climb to a record 144.52 million tons from 143.38 million tons in 2019-20, it said.

Probably for the first time, India is witnessing bumper crops and "very good commodity prices", said Mr Chaturvedi. Recent rains have improved the soil moisture level, which will benefit winter-sown crops like wheat and rapeseed, he said. India is the world's second-biggest producer of rice, wheat and sugar.

BLOOMBERG