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India's groundnut crop not seen hit by dry weather

Erratic southwest monsoon rains are unlikely to hit India's groundnut crop as severely as soybean due to its greater resilience to dry weather, traders said on Friday.

"The situation is not as bad as soybean because the first spell was very good and since the crop is very sturdy it can withstand dry weather for longer duration," Gagan Gulati of Ahmedabad-based Global Trading Company said.

Weather officials say India's four-month monsoon rains have revived after a weak phase and the western and central areas have received rains in the last two days.

The June-September rains are vital for the agriculture sector, which accounts for 25 per cent of India's gross domestic product and provides employment to 70 per cent of its one billion people.

The monsoon started in the southern state of Kerala on schedule in early June and moved up to the western parts of the country but its progress in northwestern India has been tardy.

The groundnut and soybean growing regions in central and western India received a good first spell of rains in June but rains have been erratic in July.

Traders said the groundnut crop, sown in the western and southern parts of the country, can withstand dry weather for seven to 10 days before starting to wither.

Groundnut crop has been sown on 1.95 to 2.0 million hectares compared with 1.75 million hectares in the last season in the largest producing western state of Gujarat.

"Farmers were impressed by the output last year and this year the sowing has been much higher," Govind Patel, a leading oil miller and an official of Central Organisation of Oil Industry and Trade, said from Rajkot.

Rajkot is the largest city of Gujarat's Saurashtra region, the main groundnut growing area in the state.

"But if the rains do not come within 10 days then we will be as bad as the soybean crop," Patel said, adding that only 10 per cent of Saurashtra had received a second spell of rain in the past two weeks.

PREMIUM OIL

Gujarat produced around 2.2 million tonnes of groundnut in 2001-02 (November-October), up from 1.2 million tonnes a year ago, helped by widespread rains. Sowing for 2002-03 is almost ended.

Groundnut oil enjoys premium over soybean, palm and mustard oils as its taste is preferred in western and northern India.

Andhra Pradesh in the south, the second largest groundnut growing state, produces close to two million tonnes. "The second spell of rains have been very good in Andhra, the crop is doing very well," one New Delhi-based trader said.

Major soybean growing areas, which are almost entirely dependent on the monsoon for irrigation, had virtually no rain in the past two to three weeks.

But they received some rain during the past few days, brightening prospects. If the rains do not continue the crop might need re-sowing, the traders said.

India annually produces about 5.5 million tonnes of soybean, which is sown in mid-June, and exports 2.2-2.5 million tonnes of soymeal to countries such as South Korea, Indonesia, the Philippines, Thailand and Japan.

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