SBI Says 2000-2026 Data Shows Rainfall Distribution, Not Deficit, Drives Food Prices
Updated
Updated · Republic World · Jul 20
SBI Says 2000-2026 Data Shows Rainfall Distribution, Not Deficit, Drives Food Prices
1 articles · Updated · Republic World · Jul 20
Summary
SBI said current food inflation risks should remain contained even if rainfall stays below normal, because price pressure depends more on where and when rain falls than on the headline deficit.
Data from 2000 to 2026 found no direct link between deficient monsoon years and sharp food-price spikes; well-distributed rainfall can still support farm output despite an overall shortfall.
In 2018, below-average rainfall did not trigger significant food inflation because rain was better spread across regions, the report said.
Among El Nino years, only 2009 saw June-September food inflation hit 13.1%, and SBI said that surge also reflected a 40% MSP increase, a 23.5% pay hike and a roughly Rs 60,000 crore loan waiver.
The report argues rainfall alone is a weak predictor of food prices, with monthly and state-level distribution carrying more weight for the inflation outlook.