Soybean and mustard futures in India rallied on concern that dry weather will hurt oilseed harvests. August-delivery soybeans jumped as much as 3.9 percent to a record 4,692.50 rupees ($85) per 100 kilograms on the National Commodity & Derivatives Exchange Ltd. in Mumbai, while mustard for delivery in the same month surged as much as 2.9 percent to 4,379 rupees per 100 kilograms.
Sugar for July delivery advanced as much as 3.3 percent to 3,245 rupees per 100 kilograms.
The seasonal rainfall during this year’s monsoon for India as a whole has been 22 per cent below the normal as of July 15 according to the Indian Meteorological Department and thus, the historic relationship suggest that crop production could decline by around 6 per cent during current fiscal. The average rainfall was 232.5 mm between June 1 and July 15 vs. 298.6 mm during a typical monsoon.
Monsoon rains, vital for farm output gains after last year’s drought, were 24 percent below normal in the past week and unlikely to rebound in the week ahead, the weather office said last week, raising fears of crop loss.
More than 235 million farmers depend on monsoon for growing crops such as rice, peanuts, soybean and cotton. Sowing of monsoon crops begins in June and harvesting starts in September. A delay in onset of rain over some oilseed and rice growing areas has lowered sowing, according to the farm ministry.