Sector Update | 30 May 2020
Agriculture
Agriculture
Crop damage from locust attack unlikely as Rabi harvest
complete…
…however, horticulture at risk
Over the last few days, swarms of locust have been sighted in parts of Rajasthan,
Maharashtra, Madhya Pradesh (MP), Uttar Pradesh (UP), and Gujarat. Therefore, we
interacted with Mr Pradeep Dave, President of the Pesticides Manufacturers &
Formulators Association of India (PMFAI), and industry players, and analyzed the impact of
the locusts on farmers and agrochemical players. The key insights are highlighted below:
Locust attack: Definition and degree of severity
The desert locust is a short-horned grasshopper. Innocuous when solitary,
locusts undergo a behavioral change when their population builds up rapidly.
They enter the ‘gregarious phase’ by forming huge swarms that can travel up to
150 km per day, eating up every bit of greenery on their way.
These insects fly during the day and are known for feasting on all sorts of plants
and standing crops. They destroy flowers, fruits, leaves, seeds, bark, and
growing points.
If not controlled, locust swarms can threaten the food security of a country.
In India, locusts are normally sighted during July–October, along the Pakistan
border.
What led to their early arrival?
– This can be traced back to the cyclonic storms
Mekunu and Luban that had struck Oman and Yemen, respectively, in 2018.
These turned large desert tracts into lakes, facilitating locust breeding, which
continued through 2019. Swarms attacking crops in East Africa reached peak
population from November, and have multiplied exponentially in southern Iran
and Pakistan since the beginning of 2020, with heavy rains in East Africa over
March–April enabling further breeding.
Rabi harvest starts in April and ends in May. Thus, farmers currently do not
have major standing crops on the field at risk of attack. However, horticulture
(fruits and vegetables) crops are at risk of a washout in Rajasthan,
Maharashtra, MP, UP, and Gujarat.
MP, UP, Gujarat, Rajasthan, and Maharashtra cumulatively contribute 38% to
India’s 312MMT of horticulture production (2017–18).
Vegetables constitute 59% of the horticulture production in India, and the
above-mentioned states cumulatively contribute 39% to production.
31% of the horticulture production in India comes from fruits, and the above-
mentioned states account for 40% of this production.
Summer fruits in India include mango, watermelon, orange, muskmelon, sweet
lime, jackfruit, black plum, lychee, pineapple, figs, and ice apple.
If the locust attack is not curtailed, horticulture production at these states
would be impacted.
Generally, January–March is the period for the sowing of sugarcane; any locust
attack may impact sugarcane crop in UP. UP constitutes 45% to the normal
sugarcane sowing area of India.
Early arrival of locusts a blessing in disguise for standing crops…
…however, horticulture at risk
Research Analyst: Sumant Kumar
(Sumant.Kumar@MotilalOswal.com); +91 22 6129 1569
Darshit Shah
(Darshit.Shah@motilaloswal.com); +9122 6129 1546 /
Yusuf Inamdar
(yusuf.inamdar@motilaloswal.com); +91 22 7193 4239
Investors are advised to refer through important disclosures made at the last page of the Research Report.
30 May 2020
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Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.