This Way Monsoon Can Affect the Quarter 1 Earnings
It is being estimated that delay in sowing due to scattered monsoon will affect the Q1 earnings. You might think that the monsoon has already arrived but the portion of the season which falls in Q1 FY19 remained majorly dry and scattered. As per the data of the Ministry of Agriculture & Farmers’ Welfare, it is revealed that a weak year-on-year trend in sowing numbers across crops until July 4.
It is believed that by the month of June major sowing should be done. Otherwise the weakness might reflect in the upcoming Q1 FY19 numbers of seed producers. However, by now, sowing activity should rapidly pick up to keep crop output in line with expectations. The more sowing will get postponed to Q2, the more there will be loss.
By Q1 FY19, the monsoon’s progress remained majorly scattered and tad disappointing with cumulative rainfall till July 4 being 6.6 percent lower than normal at 184.7 mm as against a normal of 197.8 mm. Many states received below normal rains till now. Some of them are Uttar Pradesh, Bihar, West Bengal, Gujarat, eastern Madhya Pradesh and Jharkhand. On the other hand, Punjab is experiencing heavy rainfall that is above normal rains. Also, Saurashtra, Kutch and Diu remained largely deficient. In the mid of July, there was a substantial pick up in monsoon activity that might help in increasing overall agri activity in the second quarter.
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