Monsoon weak, revival may come next week

A farmer ploughs his field to sow millet seeds against the backdrop of pre-monsoon clouds at Shapur village in Gujarat June 24, 2012.

NEW DELHI (Reuters) - India's crucial monsoon rains were below average last week and failed to cover as much of the country as they should have, the weather office said on its website, fanning concerns about output of crops despite reassurances from weather officials.

In the fourth week, ended June 27, of the season that provides most of the water for 55 percent of arable land, rains were 18 percent below average, reflecting a lull over oilseed-growing areas of central India.

India is sticking to its forecast for an average monsoon this year despite a slow start, with July and August providing the majority of rainfall and helping to moisten the earth for sowing and to mature planted crops.

"Monsoon rains are less than normal but can still make up the deficit in next 10 to 15 days," said M. Rajeevan, a senior scientist at the ministry of earth sciences.

Rains so far from June 1 have been 23 percent below average, compared with a 10.7 percent surplus in June 1-29 last year. They picked up in the week to June 20 to just 5 percent below average, helping sowing in some areas.

"If the lull phase continues for another 15 days, then we should be worried, but not now," said Rajeevan, a former lead forecaster of the Indian weather office.

The farm sector accounts for about 15 percent of a nearly $2 trillion economy, Asia's third-biggest, and good harvests keep up rural incomes and in turn demand for gold and consumer goods.

Farm officials said rains in the past week were above average over the rice-growing pockets of eastern India.

"Rice areas of eastern India received adequate rains in the past week," said A.K. Singh, deputy director-general of the state-run Indian Council of Agricultural Research.

Rice, the main food crop of the world's second most populous country, accounts for about 70 percent of total grain output in the summer season.

CROP SCENE

The insufficient rainfall has affected the planting of pulses, cotton, paddy and soybean. The next two weeks could be crucial as late sowing can hit yields. In some areas, farmers might have to sow a second time because rains failed after the first planting.

"If sowing gets delayed by one or two weeks, then it may affect yields," said Chowda Reddy, a senior analyst at JRG Wealth Management, a commodity brokerage based in the southern city of Hyderabad.

"In some areas farmers have sown crop, and after sowing they haven't got rains. They may need to do re-sowing if those areas remain dry for the next fortnight," he added.

Dry weather in the central region raised concerns over soybean sowing, although the market still expected an increased area under the oilseed due to record high prices.

"It would have been ideal to have rains by now, but it is never too l ate until second week of July for soybean sowing," said Rajesh Agrawal, an official of the central city Indore-based Soybean Processors' Association of India.

The July soybean contract on India's National Commodity and Derivatives Exchange was up 0.06 percent at 3,869 rupees per 100 kg by 0903 GMT, after hitting a record high of 3,900 rupees earlier in the day.

Lower-than-average rains over western Maharashtra state have raised concerns about yield prospects for the cane crop.

"Drought in some areas of Maharashtra has already affected the cane crop. Urgent rainfall is required to avoid further damage," said Harakhchand Vora, vice-president of the Bombay Sugar Merchants Association.

Western Maharashtra state is the top sugar producer in the country, and the major cane-growing central area of the state received 73 percent less rains than normal last week.

MONSOON REVIVAL?

Weather officials said the rains were expected to improve next week.

"We expect monsoon to progress further deep into central India and also towards north India during next week," said a senior official at the India Meteorological Department.

The weather office has forecast average rain in the vital planting month of July, when rains should spread to the entire country. The rainfall then is key to the growth of summer crops such as rice, corn, cane, oilseeds and cotton.

(Additional reporting by Rajendra Jadhav in MUMBAI; Editing by Jo Winterbottom and Jane Baird)