Monsoon rain too late for sugarcane, rice

By Himangshu Watts and Mayank Bhardwaj

NEW DELHI (Reuters) - India's monsoon delivered above-average rains last week for the first time this season but the worst dry patch in more than 80 years has already hit rice and sugarcane crops.

It has also depleted India's reservoirs, choking hydropower supply and boosting fuel demand as farms, homes and businesses used standby generators in June, the peak summer month.

Farm commissioner, N.B. Singh said sugarcane cultivation may fall 2.4 percent. This may trigger even bigger imports next year by India, which is already a big buyer and a key factor behind the surge in global sugar prices this year.

But Singh said cotton cultivation was higher this year, and if the monsoon rainfall was adequate in coming weeks, he did not expect a loss in output of crops other than rice.

"Prospects are not as bad as expected earlier," he told reporters after the weather office made a rosy forecast.

POWER SHORTAGE

Weak June rainfall has reduced the water level in India's main reservoirs by more than half, limiting the prospects of irrigating winter-sown wheat and rapeseed crops, and reducing hydropower supply by 10 percent, government officials said.

While hydropower accounts for a quarter of India's power generation, power supply has been further depleted by a severe shortage of coal in the country.