Favorable monsoon rains ensure sufficient soil moisture in India's wheat-growing regions. Indian wheat production is now estimated at 110 million tons, slightly above last year's record.
The core countries of wheat production, including Madhya Pradesh, Rajasthan, Punjab, Haryana, Bihar and Uttar Pradesh, recorded above-average rainfall during the monsoon season (June-September), which provided sufficient soil moisture for wheat cultivation. In addition, the delayed retreat of the monsoons in northeast India in October brought nearly a record amount of rain, which further replenished soil moisture in key wheat-growing areas. The abundant rainfall and the favorable soil moisture will favor the wheat production of the Indian farmers.
As for prices, local wheat prices have been more than 10% higher since September compared to the same period last year, but prices for rapeseed, a major competing crop, rose more than 50% year over year.In addition, the government-set minimum price (MSP) for wheat rose by 2% (40 rupees) to 2015 rupees per quintal (0.1 metric ton) in 2022/23, while the MSP for canola, mustard and lentils increased by 8-9% ( 400-450 rupees) rose. The wheat / rapeseed price ratio fell to its lowest level in 15 years.
Taking into account favorable growing conditions and less competitive prices compared to other crops, we estimated the Indian wheat sowing area in 2022/23 to be 31.3 million hectares. According to the Ministry of Agriculture, India planted 4.11 million hectares of wheat on November 12, compared to 4.61 million hectares in the same period last year. The wheat sowing will continue until January.
A reasonable initial soil moisture level sets the mean estimate of the wheat yield in 2022/23 at 3.50 tons per hectare. The fluctuations in yield depend on the temperatures and rainfall from January to April. With favorable cool temperatures and normal rainfall, the wheat yield could rise to over 3.50 tons per hectare.Alternatively, hot temperatures and / or unusual storms / hail during harvest could significantly reduce production.
Source
Hansa Terminhandel GmbH