Rice output may be lower than initial estimates

Last year, the Centre underestimated the country's kharif rice production by overestimating the impact of drought. Thus, in its first advance estimate, the output was assessed at 69.45 million tonnes (mt) that got revised subsequently to 75.91 mt. Much of this was on account of Punjab and Haryana. Both these States ended up harvesting bumper crops despite the drought. While the near-universal irrigation cover available with their farmers was definitely a factor here, the dry weather actually turned out a blessing of sorts: It ensured minimal incidence of attacks by the white-backed plant-hopper and other major pests and diseases. This time, it could be quite the opposite. In its first advance estimate, released in September, the Agriculture Ministry has projected kharif rice production for 2010 to rebound to 80.41 mt on the back of an overall surplus South-West monsoon. But going by mandi arrival trends so far, it looks as though the damage caused by floods in some paddy-growing areas and very little rains in some others has not been fully factored in by the Ministry – leading to a possible overestimation of output. In Punjab, only 122.21 lakh tonnes (lt) of paddy have arrived till now in the various mandis, compared to the 133.14 lt during this time last year. Haryana (24.51 lt versus 27.09 lt) and Uttar Pradesh (4.22 lt versus 6.59 lt), too, have recorded lower arrivals. As a result, total rice procurement by the Food Corporation of India (FCI) and State agencies in the ongoing 2010-11 marketing year (October-September) has been only 98.01 lt, as against cumulative buys of 106.32 lt during this period of 2009-10. Procurement is trailing in both Punjab (80.75 lt versus 87.42 lt) and Haryana (15.41 lt versus 17.14 lt). Officials ascribe the dip in the two north-western States to lower yields, which, in turn, were an outcome of floods in early-July that damaged large areas where planting of normal high-yielding parmal paddy had already taken place. Since this area could not be re-transplanted with non-basmati (the window for which was already over), farmers had to go in for basmati. And within basmati, they opted for even lower-yielding traditional varieties as opposed to the improved Pusa-1121 or Pusa Basmati-1 that had fetched low prices last year. In addition to this, farmers in Punjab had sown very little area this time under PAU-201, a variety giving 7.5 tonnes of paddy a hectare against 7 tonnes for normal non-basmati varieties. There were quality issues with PAU-201, with FCI refusing to buy on these grounds. As a result, its share in total non-basmati paddy area fell from a fifth to virtually nil and the overall yields, too, dropped, as expressed by a State official. In other States, a clear picture of production trends in other States is yet to emerge. However, the fact that West Bengal, Bihar, Jharkhand and East Uttar Pradesh have recorded deficient monsoon rains does not give much hope for a bumper crop from this region, which is a major paddy belt. The one State that, till recently, was expected to generate a good crop this year because of copious monsoon rains is Andhra Pradesh (AP). But two successive low-pressure build-ups within a week's span have changed it all. The latest floods are estimated to have inundated and destroyed some 3.21 lakh hectares of paddy area. AP estimated out paddy production this year at 84 lt. But now, we may have to contend with 10-15 lt less. While all these could result in a downward revision of the country's estimated rice production this year, it is unlikely, however, to really influence overall availability or prices. The main reason for this is the more-than-comfortable public foodgrain stocks. As on November 1, rice stocks in the Central pool, at 231.73 lt, exceeded the corresponding levels of 216.21 lt and 141.39 lt for the preceding two years.