Seasonality in crops is the normal crop pattern that most crops go through during the year. The seasonality of a crop is determined by the highs and lows of a harvest season. Most of the time, the consumption of a particular crop is higher in its peak harvest season. Therefore it is fair to assume that the price of cash crops would vary during different times of the year.
In India, there are two seasons for the harvest of crops. They are divided into kharif crops and rabi crops. Rabi crops are harvested in summer, while the kharif crops are harvested from September to October.
Rice is India’s most lucrative cash crop. Almost all of India has rice as its staple carbohydrate. Rice is a kharif crop. Kharif crops usually require hot summers and plenty of water to grow properly. Wheat,however, is a rabi crop. Such crops require a warm climate for germination and cold weather to harvest fully.
The agriculture business isn’t as predictable as it seems. Due to the rising abnormalities in climate, it gets harder to predict how well a certain cash crop will grow. Therefore the availability of the crop also determines the price of the agri produce in the market.
There are also some sets of climate patterns that cause abnormalities such as El Niño and La Niña. The impact of the El Niño and La Niña lasts from 9 to 12 months. The El Niño brings about warmer climates while the La Niña brings about colder global climates. The unpredictability of these weather phenomena brings about volatility in the agri-commodity market.
Soyabean:- The off-season of soyabeans is during the summers. However, soyabeans are consumed all year round. This means that seasonality doesn’t affect the consumption demand for soybeans. However, during the summers, the price of soyabean increases. This is because, during the summers, soyabeans will have to be stored in godowns and warehouses. The wholesalers will also have to account for the loss in quantity due to spoilage.
Corn:- Conversely the off-season for corn is during the summers and spring times. Like in the example for soyabean, the price of corn rises in the summers because of the warehouse costs, quality control and pest control.
Therefore we see how the seasonality of certain cash crops affects the prices of these goods.
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