Rabi output to raise GVA of agriculture, forestry and fishing in Q4 FY2022: ICRA estimates

With a modest increase in the YoY growth in rabi output, relative to the Kharif season, the Gross value added (GVA) of agriculture, forestry and fishing is expected to rise to 3.0 per cent in Q4 FY2022 (+2.8 per cent in Q4 FY2021) from 2.6 per cent in Q3 FY2022, says ICRA Update on Agri Outlook: Robust reservoir storage reduces the sensitivity of volume of upcoming monsoon.

As per the second advance estimates (AE) of crop production, rabi output is estimated to touch record levels for several crops in FY2022.

The cumulative rabi sowing exceeded the year-ago level by 1.5 per cent in FY2022, led by higher sowing in pulses (+1.3 per cent) and oilseeds (+22.8 per cent) whereas rice (-17.5 per cent), coarse cereals (-1.4 per cent) and wheat (-0.8 per cent) trailed the year-ago levels as on February 4, 2022.

The Ministry of Agriculture and Farmers’ Welfare has estimated the total rabi production at a record-high in FY2022, ~2 per cent higher than the final estimates for FY2021. Barring coarse cereals and rice, the rabi output of other major crops is expected to rise in FY2022.

According to the report, there has been only a marginal 0.2 per cent rise in Kharif sowing and a 1.7 per cent increase in output as per the AE of crop production, the growth in the GVA of agriculture, forestry and fishing has been pegged at 2.6 per cent for Q3 FY2022.

The Kharif output for FY2022 has also been revised downwards by 1 per cent as per the 2nd AE of crop production, relative to the 1st AE.

Additionally, the pace of agricultural GVA expansion was pared sharply for Q1 FY2022 (to +3.5 per cent from +4.5 per cent) and Q2 FY2022 (to +3.7 per cent from +4.5 per cent). ICRA report points out that as the rainfall in the winter season (Jan-Feb 2022) was excess at 144 per cent of the long-period average (LPA), with most regions recording above-normal rainfall, it may not be ideal for yields.

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