NISM Certifications · NISM-Series-XV: Research Analyst · Fundamental Analysis of Commodities
In fundamental analysis of agricultural commodities, a below-normal monsoon is generally expected to:
A below-normal monsoon is generally expected to reduce kharif crop output and push prices up. Kharif crops depend heavily on monsoon rainfall, so deficient rain cuts yields and supply, while demand for food and feed stays relatively stable.
- AReduce crop output and tend to raise prices of kharif cropsCorrect
- BIncrease crop output and lower prices of kharif crops
- CHave no effect on supply of kharif crops
- DReduce prices because of lower demand from farmers
Explanation
Kharif crops depend heavily on monsoon rainfall. Deficient rains lower yields and supply, which tends to push prices up, other things equal.
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