The four-month southwest monsoon cycle (June to September 2026) in the country has entered the withdrawal phase. In June this year, the monsoon started 4 days late and after that stalled for almost three weeks. Early July rains revived hopes, but precipitation in August and September was less than satisfactory.

As a result, as of September 20, the country faced a rainfall deficit of 15% (-15%). The temporal and spatial distribution of rains has been rather uneven. Out of the country’s 36 meteorological subdivisions as many as 19 subdivisions representing 51% of the national area, faces deficient rains. There are borderline cases even among the rest of the subdivisions said to be ‘normal’.  

A look at the cumulative rainfall map shows key growing areas – Punjab, Haryana, parts of Rajasthan, parts of Gujarat (Saurashtra, Kutch), parts of Maharashtra (Marathwada) as well as almost the whole of Andhra Pradesh, Telangana and Karnataka, Assam and Northeast - are ‘red’ in colour with varying intensity of moisture stress.

The ravage inflicted by El Nino induced dry conditions is clearly visible. The situation worsened with high cost of fertilizers and limited availability due to the military action in the Persian Gulf region. 

The table alongside shows 2025 and 2026 acreage, production target for 2026, forecast production in 2026 and government estimated production in Kharif 2025. The production forecast for this Kharif season is based on ERTF Advisor G. Chandrashekhar’s proprietary research.  

KHARIF 2026-27 KEY CROPS  PRODUCTION FORECAST

As of September 20, 2026

CROP            Area   Area             Prdn Target              Production    GoI Estimate

                        2025    2026               2026                            Forecast         2025

RICE              44.7     42.7                 123                              116 - 118         124.8

PULSES         11.9     11.8                  8.4                              7.0 – 7.3              7.6

MAIZE           9.9       9.2                  31.0                             28.0 - 28.5         30.5

SOYBEAN    12.4     12.2                 14.8                             9.5 – 10.0          12.6

COTTON      11.0     10.9                 33.6                             27.5 - 28.0         29.0

SUG’CANE  5.9        5.8                 500                              440 – 450          500   

(Area in Million Hectares; Production in Million Tonnes; Cotton in Million Bales

2026 Harvest forecast by G. Chandrashekhar (proprietary research))

In most cases, planted area is lower than last year Kharif. Poor distribution of rainfall has impacted planted area, yields and production. Rice, pulses, cotton, soybean, groundnut and sugarcane crops are affected.  

It is safe to conclude that the Kharif 2026-27 harvest will fall short of season’s production target and below last year’s government estimate. In some regions, crop quality may be affected. As a result, the supply-demand fundamentals of many crops will tighten further.

Rice buffer stocks of 40 million tonnes are a source of comfort. Sam time, imports of many commodities are set to increase: Pulses > 7 mln t; Vegetable oils 16-17 mln t; Cotton > 7 mln bales.

High international energy costs and a weak Rupee may exacerbate the price situation and heighten inflation expectations. It is likely, the government may tighten the screws on agri trade.  

How does the future look? There’s a bigger alarm. According to Met reports, El Nino may further intensify in Oct/Nov/Dec months. That’s precisely the time for completion of Kharif harvest and planting of Rabi crops (mainly wheat, rice, maize, oilseeds (rapeseed/mustard, groundnut) and pulses (chickpea, lentil). Adequate winter rains are critical for the Rabi crops. Already Indian wheat is at the limit of heat tolerance. Warmer days in Jan/Feb and heat waves in March can reduce harvest size  

So what are the policy options open to New Delhi? One, some restriction on diversion of rice, maize and sugarcane for ethanol. Two, eliminate 10% customs duty on crude vegetable oil import and make refined oil import more viable with duty reduction.

In any case, pulses imports will continue till March 2027 and the policy may be extended. Fodder availability for the livestock will be a challenge. Reservoir storage levels may turn critical in Q1 2027.

Assembly election in Uttar Pradesh, Gujarat and Punjab early 2027 may influence policy decisions.