The El Nino impact on the Indian monsoon typically manifests by way of extended break in rainfall.
"This year, the Southwest Monsoon is likely to set over Kerala on May 31 with a model error of four days," the India meteorological department said on Wednesday.
Less-than-expected rainfall and a poor spatial distribution, experts say, can rekindle fears of a rise in food and fuel inflation that can have an impact on the RBI's monetary policy. The fear of less than optimal rainfall due to El Nino this year, analysts believe, is the biggest short-term risk for the markets, which they said has not been fully priced in yet by them. Monsoon set over Kerala on June 08, a week later than its scheduled date.
We should be prepared for any impact of the dreaded weather pattern.
Rainfall in August is predicted to be below normal (less than 94 per cent of LPA), but the situation is expected to improve comparatively in September, the IMD said.
A private sector weather forecaster, Skymet, and some global forecasters have already issued warnings for this year that this could happen.
'A weak monsoon always spells disaster. But it's too early to have a pessimistic view.'
If the weather phenomenon hits India, impact will be felt across sectors; be cautious on stocks based on rural consumption.
Senior officials of the India Meteorological Department said they were now more confident that El Nino would indeed appear during the second half of the southwest season, compared to April when the last official forecast was made.
El Nino, which refers to warmer-than-average sea surface temperatures in the central and eastern tropical Pacific Ocean, will likely to keep CPI inflation up at 8-10 per cent in the second half of 2014 and will pose a 50-70 basis point risk to this fiscal's growth expectation, the report by financial services major Bank of America Merrill Lynch said.
El Nino, an anomalous rise in sea surface temperature off the Peru coast, has been observed to often cause the Indian monsoon to flounder, resulting in poor rainfall. Nearly 60 per cent of agricultural land is wholly rain-dependent.
The El Nino weather phenomenon will bring drier winter weather to Indonesia, India, Mexico, Central America and northern Brazil, US government weather forecasters said.
'If because of El Nino, the monsoon is affected adversely in the current year, naturally it will affect income projections and consequently Budget numbers.'
In the coming months, globally as well as in India, rice might remain a hot potato.
Climate scientists warn that climate change is intensifying heatwaves in India, with the cooling effects of La Nia potentially becoming less effective in a warmer future. The India Meteorological Department (IMD) predicts an early summer with above-normal temperatures and intense heatwave spells, following an unusually dry winter and the warmest February since 1901. Experts emphasize the role of human-caused climate change, along with natural climate drivers like El Nio and La Nia, in shaping weather patterns. While La Nia typically brings cooler temperatures, scientists suggest that under climate change, its ability to mitigate heatwaves may be diminished.
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An El Nino is a temporary change in the climate of the Pacific Ocean, in the region around the equator.
'Geopolitical risks and their impact on oil prices, if any, are another concern for global markets, particularly for India.'
Officials in the weather department said the monsoon is expected to be below normal because of the El-Nino effect.
Wholesale price-based inflation eased to a nine-month low of 4.68 per cent in February, while retail inflation slowed to a 25-month low of 8.1 per cent.
The government must expand the farm insurance cover and advice banks and financial institutions to settle crop insurance claims in the drought-hit areas without delay.
IMD will present its month-wise and region-wise forecast in June.
The India Meteorological Department in its first forecast for 2014 had said southwest monsoon will be below normal at 95 per cent of the long-period average.
If El Nino condition affects the monsoons, as is being forecast by foreign agencies, it can slow down the economy to 5.2 per cent next fiscal from a projected 6 per cent.
The Indian Met Department has predicted a below normal monsoon.
Skymet expects a good monsoon over western and southern India.
A rise in farm sector is estimated to raise demand for industrial goods and services, it added.
About 60 per cent of net sown area of the country is rain-fed. With every one per cent deficit in rains, the country's gross domestic produce falls by 0.35 per cent.
El Nino is often associated with below average warmer, dry weather across Asia Pacific region.
The southwest monsoon has arrived in Mumbai 16 days before its usual date, making it the earliest arrival since 1950. This early onset follows the monsoon's arrival in Kerala, the southernmost state, on Saturday, marking the earliest arrival since 2009. The India Meteorological Department (IMD) predicts an above-normal rainfall for the 2025 monsoon season, with rainfall between 96 per cent and 104 per cent of the 50-year average of 87 cm considered 'normal'. The monsoon is crucial for India's economy, providing vital water for agriculture and replenishing reservoirs.
Heatwave may abate over most parts of North India in next two days; temperatures likely to drop by 2-3C.
Steps to improve governance, instill confidence in the government machinery and streamlining function across the different ministries are also important to feed the positive mood, the DBS report added.
The same development would benefit the progress of the north-east monsoon, also known as the 'reverse monsoon'.
India is likely to see above-normal rainfall in the four-month monsoon season (June to September) with cumulative rainfall rainfall estimated at 106 percent of the long-period average (87 cm), he said.
Monsoon revival over weekend likely, but second-half rainfall may be muted. If the rains become scarce after mid-August, the standing kharif crops might be impacted
Spurred by cyclone Remal, the southwest monsoon set in over the Kerala coast and parts of the northeast on Thursday, a day earlier than forecast by the weather office.
The planet experienced its warmest January on record last month despite the development of La Nia, a climate pattern that usually brings cooler global temperatures, the European climate agency said on Thursday. This comes on the heels of the Earth experiencing its hottest year on record in 2024, also the first to see global average temperatures rise 1.5 degrees Celsius above pre-industrial levels. According to the Copernicus Climate Change Service (C3S), January 2025 recorded an average temperature of 13.23 degrees Celsius, 0.09 degrees warmer than the previous hottest January (2024) and 0.79 degrees above the 1991-2020 average. Scientists also found that the Earth's temperature in January was 1.75 degrees Celsius higher than pre-industrial levels. Global temperatures have stayed above the 1.5-degree mark for 18 of the last 19 months.
Domestic-focused agricultural chemical (agrochem) companies could face near-term headwinds, given the worries on the El Nio effect on monsoons, higher inventory, and pressure on margins. Some of these were reflected in the October-December quarter (third quarter, or Q3) results of companies and may impact them in the current quarter (fourth quarter, or Q4) as well. Nuvama Research pointed out that the sector witnessed mixed performance during the quarter as global agrochem and domestic fertiliser companies maintained growth momentum, while adverse agronomical conditions and excess channel inventory weighed on domestic market volume offtake.
The finance ministry on Thursday raised concerns over the possible impact of El Nio conditions on India this year, saying if recent forecasts came true, the country could see lower agricultural output and higher inflation. "Some meteorological agencies predict the return of El Nio conditions in India this year. "If these predictions are accurate, then monsoon rains could be deficient, leading to lower agricultural output and higher prices," the ministry said in its monthly economic review.
June rainfall accounts for 15 percent of the total precipitation of 87 cm recorded during the four-month monsoon season in the country.
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