June 13 (Bloomberg) -- Rice output in India, the world’s second-largest grower, is set to climb to a record as early arrival of monsoon rains over the biggest growing regions spurs planting, potentially boosting exports.
The monsoon crop may increase 2.4 percent to 95 million metric tons from 92.75 million tons a year earlier, said P. Chengal Reddy, secretary general of the Consortium of Indian Farmers Associations. The rain-fed crop is planted from June and harvested from October and accounts for almost 90 percent of the nation’s total production.
A bigger harvest may help India retain its position as the top exporter and further lower global food costs tracked by the United Nations’ Food & Agriculture Organization, which fell in May for the first time in four months. While rice prices are poised for a third year of gains in Chicago, corn and wheat have tumbled into bear markets after surging last year when the worst drought since the 1930s wilted crops in the U.S.
“Given the forecast for a normal monsoon, the area under rice will certainly be more than last year,” Trilochan Mohapatra, director of the Central Rice Research Institute, said in a phone interview from Delhi. “The production of rice is going to exceed” last season’s levels, he said.
Farmers have sown rice in 523,000 hectares (1.29 million acres) as of June 7, compared with 622,000 hectares a year earlier, according to data from the Agriculture Ministry. The monsoon, which accounts for more than 70 percent of the country’s annual rainfall, covered Andhra Pradesh and West Bengal states a day earlier than normal, according to the India Meteorological Department.
Showers have been 23 percent more than a 50-year average since June 1, with Andhra Pradesh getting at least 70 percent more rains, bureau data showed. Andhra Pradesh and West Bengal are the nation’s top growers, representing about 29 percent of the crop.
India may continue to export as a normal monsoon and reserves of 33.3 million tons will leave enough for shipments, Angel Commodities Broking Pvt. said June 10. Exports totaled 10.25 million tons in 2012, according to the Foreign Agricultural Service of the U.S. Department of Agriculture.
Rough rice for delivery in July was little changed at $16.28 per 100 pounds on the Chicago Board of Trade at 2 p.m. in Mumbai. Futures have advanced 7.3 percent this year after gaining in the past two years. Global rice production may expand to 470 million tons in 2012-2013 from 466 million tons a year earlier, according to the International Grains Council.
“We have asked farmers to increase use of hybrid seeds,” Mohapatra said. The high-yielding varieties can boost output by about 1 ton per hectare compared with the normal varieties, he said. Farmers planted about 39 million hectares under rice during the monsoon season in 2012-2013, the farm ministry says.
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