Monsoon stalls, drought a fear after mid-July

NEW DELHI (Reuters) - India's monsoons should improve next week, Agriculture Minister Sharad Pawar said on Tuesday, as concerns grow that the progress of the crucial June-to-September rains has halted and has hit the sowing of some crops in the major food producer and consumer.

Weather experts said that if the lull continues beyond July 10 or so, however, it would be difficult to make up such a huge gap on the rains, raising the risk of drought after two rainy years.

"By and large the situation may not be fully satisfactory, but it is not bad either ... There is ample opportunity to cover the delay," Pawar said in a meeting with journalists after newspapers reported rising worry over low rainfall.

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

The rains, which provide the main source of water for 55 percent of India's arable land, were 31 percent below average from June 1 to July 2, losing even more pace in the past week after being 23 percent below average to June 27.

"We will really head towards a bad monsoon year if it does not revive by July 10," said D. R. Sikka, former director of the Pune-based Indian Institute of Tropical Meteorology.

The weather office still holds to its forecast of an average monsoon this year despite the lag so far.

The monsoon has stalled over central India, leaving the northwest states of Uttar Pradesh, Haryana and Punjab without their normal rainfall. In Delhi, temperatures have soared to 45 degrees on some days, making it the hottest June for over 30 years, according to a Times of India survey.

India's 1.2 billion people make it one of the world's biggest consumers of rice, sugar and grains. While it is usually self-sufficient in these foodstuffs, the country is a major importer of pulses and edible oils.

"The only concern at this moment is that the area coverage for major summer crops should not fall below last year's levels," said Prasoon Mathur, a senior analyst with brokerage Religare Commodities.

The weather office's latest update backed Pawar's optimism.

"Conditions are favourable for further advance of southwest monsoon into the remaining parts of Maharashtra and some more parts of Gujarat, Madhya Pradesh during next 48 hours," the India Meteorological Department (IMD) said on its website.

The IMD forecast an increase in rainfall over rice, cane, cotton and soybean growing areas of the northwest to July 10.

CORN ACREAGE COULD SWITCH TO PULSES, OILSEEDS

For Punjab and Haryana, where about 93 percent of arable land is irrigated, the lack of water should not have a big impact on rice, cane and cotton planting.

Monthly monsoon rains, click link.reuters.com/bew88s

Indian monsoon and key summer food crops, click link.reuters.com/nez58s

In Gujarat and Rajasthan, Pawar suggested that the usual coarse cereal crops might be replaced with pulses and oilseeds, which would be a bonus for the government, because India is a major importer of both while it is sitting on a surplus of corn.

Rajasthan has been so hot that camel owners have been moving their animals to neighbouring states such as Madhya Pradesh to find food and water.

"It's true that in certain states where sowing begins early there's some impact," Pawar said, adding affected states include Maharashtra, Karnataka, Rajasthan, Madhya Pradesh and parts of Uttar Pradesh and Bihar.

"The overall situation of rice planting is not worrisome. Corn planting has been affected," he added.

The early stages of the monsoon help to soften the soil for planting of crops, while July and August rains are the most important for maturing seedlings and enhancing yield.

The weather office still forecasts an average year for the monsoon despite the current delay.

Pawar said if necessary, India was ready to tap its burgeoning stocks of grain, which are overflowing from warehouses and added that states have contingency plans to hand out more seeds if replanting is necessary.

"The government can offer from its stocks if the situation demands. (There is) no dearth of grains," he said.

Farmers are worrying the delay could hike input costs and retard growth of some crops such as cane.

"More delay will increase input costs as more diesel would be needed to run irrigation facilities," said Sudhir Kumar Panwar, chief of the Kishan Jagriti Manch, a farmers' group.

Low rainfall can affect sugar cane's vegetative growth, potentially cutting sugar content in the sturdy crop. (Editing by Jo Winterbottom and Jane Baird)