* Rains to return below average in week to July 18
* Weather office to forecast Aug-Sept rainfall by July end
* Plantings in rice, lentils, oilseeds lag behind
By Ratnajyoti Dutta
NEW DELHI, July 18 (Reuters) - Halfway through the crucial
planting month of July, India's monsoon rains continue to cause
concern, with sowing of pulses and rice behind schedule and
rainfall still 22 percent below average for the time of year.
If there is no pick-up by the end of July, when India's
meteorological department will update its official forecast,
this year might qualify as a drought, with rainfall less than 90
percent of average annual levels.
"We haven't yet arrived at any conclusion about a failure of
this year's monsoon as there are signs that rains will improve
over the central region this weekend," D.S. Pai, the head of the
Indian weather office's long-range forecasting, told Reuters.
The next weekly update is due on Thursday and for the week
to July 18 the rains could retreat to below average levels,
weather office sources said, after scraping above average the
previous week for the first time in this rainy season.
Even the normally sanguine farm minister, Sharad Pawar, has
started talking about a possible shortfall in grains output,
particularly rice, as he described the monsoon as "playing
Food Minister K.V. Thomas said output of pulses (lentils)
could fall, pushing up prices of the cheap source of protein for
many of India's poor and fuelling further food inflation, which
hit 10.81 percent in June.
Pawar, however, stressed there was no need for alarm over
domestic supplies as India, one of the world's leading producers
and consumers of farm commodities, is sitting on massive
stockpiles of rice and wheat after bumper harvests.
But a drought - officially recognised if monsoon rainfall is
less than 90 percent of a 50-year average of 89 centimetres -
could mean India curbs exports of rice and sugar at a time when
a severe water shortage in the United States is pushing key
global grain prices higher.
Thomas and Pawar have both said mid-August will be the time
to decide on exports, when the strength of the monsoon will be
clear. India currently allows unrestricted exports of rice,
wheat and sugar.
RAIN DISTRIBUTION HOLDS THE KEY
More than half of India's arable land is rain-fed, and the
farm sector accounts for around 15 percent of India's economy,
Asia's third-largest, but where it falls is the key and the
rains have been very patchy this season.
Poor rains have slowed the speed of planting crops such as
rice, cereals, pulses and oilseeds including soybean, but areas
under sugar cane and cotton, primarily grown in irrigated
regions, have been higher than the previous year.
And even in 2009, when monsoon rainfall was 22 percent below
average and India had to import sugar, the country's food grains
production fell only 7 percent from the previous year.
Pai said the rains have picked up in the last couple of days
in parts of western Maharashtra, which grows sugar cane,
oilseeds and cotton, and in southern Karnataka state, which
grows primarily sugar cane and pulses, and where they had been
weak since the start of the season.
"Dryness is likely to affect cane yields. There will be a
drop in sugar production," said Ashok Jain, president of the
Bombay Sugar Merchants Association.
Sugar futures have risen to their highest level in
over 18 months on poor rains in all top three sugar-producing
states - Maharashtra, Karnataka and northern Uttar Pradesh.
India is also vulnerable in pulses and oilseeds as it is a
net importer of edible oils and pulses and they can stoke food
inflation, which rose again in June to 10.81 percent - largely
on the back of shortages due to lack of rain.