New Delhi: India’s monsoon is likely to be below normal this year, private forecaster Skymet Weather Services said, dampening the prospects of higher farm output in a country where the June-September rainfall irrigates more than half the farms.

The probability of below normal rain in the four-month period is 55% and that of drought 15%, Skymet said on Wednesday. “The monsoon rainfall is likely to be 93% (+/-5%) of the long-period average (LPA) of 887 mm," it said. Seasonal rainfall between 96% and 104% of the 50-year average is considered normal rainfall.

“Monsoon could have a sluggish start this year. There is higher probability of below normal rains in June (75%) and then July (55%), which are two critical months for the sowing of crops in northern states. It would improve August onwards," said Jatin Singh, managing director of Skymet.

Adequate rain in the monsoon season is critical for India’s more than 100 million farmers and their dependents, as the rainy season accounts for over 70% of the country’s annual showers. Lower crop output also hurts rural consumption, affecting consumer goods firms, and tractor and motorcycle makers.

“It is an early warning signal," said N.R. Bhanumurthy, a professor at the National Institute of Public Finance and Policy in New Delhi. “This could delay sowing of kharif crops and impact agricultural production. Other allied sectors including power, automobile and banking sector could see cascading effects."

Last year, Skymet had overestimated the rainfall to be at 100% of LPA, as the actual rainfall was recorded below normal at 91%. In 2017, its forecast matched the actual rainfall. If its monsoon forecast for 2019 are correct, India could witness the lowest monsoon rainfall in three years.

The government-run India Meteorological Department (IMD) will release its first long-range monsoon forecast in mid-April.

The stakes are high as farmers are still recovering from the impact of below normal rains last year. Six states— Maharashtra, Jharkhand, Andhra Pradesh, Karnataka, Gujarat and Rajasthan—were declared drought-hit.

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“It is a red flag for interior regions of Maharashtra, Telangana, and Andhra Pradesh, which are reeling under agrarian stress. The reservoir levels are low and a shortfall in monsoon worsens the situation," said Madan Sabnavis, chief economist at CARE Ratings.

After facing droughts in 2014 and 2015 because of the El Nino weather pattern, India’s monsoon prospects improved in 2016 when it got normal rainfall at 97% of LPA. In 2017, the rainfall hovered at near-normal levels (95% of LPA), which dropped last year to 91% of LPA (below normal).

“It is clear that the risk of below normal rains is building up. We are not sure if it would necessarily materialize. But if that happens, it would create a downside for growth and upside for food inflation," said D.K. Joshi, chief economist at Crisil.

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