Weak Monsoon Cuts Indian Farmers’ Input Spending

India’s southwest monsoon is running about 15% below normal and has been especially weak in September, raising concerns about crop yields, rural incomes and food inflation. Uncertainty over harvests is prompting farmers to conserve spending on pesticides, fertilizers and seeds, particularly herbicides and fungicides, while the farm-input industry faces intensifying competition and possible consolidation. The uneven distribution of rainfall is a major concern, with persistent deficits in eastern, northeastern and southern regions despite some improvement in central and northwestern India. Central India and the northwest—important production regions for crops including cotton, oilseeds, pulses, sugarcane and rice—have experienced smaller shortfalls that may cushion the broader impact on output and prices. The weaker farm outlook is also expected to slow tractor demand sharply, with wholesale volume growth projected at just 1% to 4% in FY27 after a 23.5% increase the previous year, although manufacturers’ margins may remain relatively stable.