
IMD cuts August-September rain forecast as El Niño strengthens. Below-normal rains threaten rice, soy, and cotton crops, stoking food inflation and complicating RBI rate policy.
The India Meteorological Department cut its August-September rainfall forecast to below normal, citing a strengthening El Niño event that now stands at moderate levels and is expected to intensify. The revision threatens summer-sown crops and could push food prices higher, complicating the Reserve Bank of India's rate stance.
"During this period, below-normal rainfall is very likely over many parts of the country except some parts of the Peninsular India, Central India, northern parts of northwest India and East and Northeast India where normal to above-normal rainfall is likely," the IMD said in its latest forecast. The department noted that moderate El Niño conditions prevail over the equatorial Pacific Ocean, with sea surface temperature anomalies remaining above normal across the central and eastern Pacific. Forecasts from the Monsoon Mission Coupled Forecast System also indicate continued strengthening through the rest of the monsoon season.
The Ministry of Earth Sciences told Parliament on July 30 that El Niño is likely to strengthen further during the October-December season and may reach a very strong category. The ministry cautioned that its exact intensity and impacts over India depend on the evolving ocean-atmosphere coupling, of which El Niño is only one factor. The IMD continuously monitors conditions and issues regular seasonal and monthly advisories.
The World Meteorological Organization warned that El Niño will influence global temperature and rainfall patterns, increasing the risk of extreme weather. The WMO's August-October rainfall outlook shows patterns typical of a strong El Niño event, with drier-than-normal conditions more likely over the Indian subcontinent.
United Nations Secretary-General António Guterres painted an alarming picture. "El Niño is strengthening, adding fuel to a planet already on fire with scorching heat domes, apocalyptic wildfires and record hot seas," he said July 31. "El Niño is not just on our doorstep; it is inside the house and turning up the heat, and this is only a warm-up act."
El Niño conditions refer to unusually warm ocean surface temperatures in the central and eastern Pacific. The opposite phase, La Niña, brings cooler ocean temperatures and stronger easterly winds. Both phenomena shape monsoon rainfall and drought patterns globally. For India, a strong El Niño typically suppresses monsoon rains, and the IMD has already pegged August rainfall at less than 94% of the long-period average.
Below-normal rain in the second half of the monsoon threatens key summer crops including rice, soybeans, groundnuts, and cotton. The 2026 harvest, which accounts for roughly half of India's annual food output, depends heavily on August-September rains. A shortfall would shrink domestic supplies and widen the import gap for edible oils, where India already buys 55-60% of its consumption from Indonesia and Malaysia. Higher import demand would push up global palm oil and soybean oil prices and squeeze domestic refiners' margins.
Food inflation remains a headache for the RBI. The central bank has held the repo rate at 6.50% for most of the year, with consumer price inflation hovering near the upper end of its 2-6% target band. A poor monsoon would lift vegetable and cereal prices, delaying rate cuts and keeping borrowing costs elevated for businesses and households. Bond markets have already priced in a longer pause; any additional inflation pressure would reinforce that view.
The El Niño threat also puts pressure on the government's fiscal arithmetic. The 2026 budget built in assumptions of normal crop output and muted food inflation. If the harvest disappoints, the government may need to spend more on fertilizer subsidies, rural relief, and food procurement, potentially widening the fiscal deficit.
Traders in agricultural commodity markets are watching the rain distribution closely. Soybean and cotton futures on the National Commodity and Derivatives Exchange have already edged higher on supply concerns, while palm oil imports have picked up ahead of potential domestic shortages.
The IMD's next update, due mid-August, will provide district-level rainfall projections. If the August 1-15 cumulative rainfall falls below 70% of normal, the crop damage estimates will get revised higher. The WMO's next El Niño bulletin, scheduled for September, will give a clearer picture of how long the event will persist.
Guterres's warning leaves little room for doubt. "This is only a warm-up act."
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