1. IMC Panel Discussion on ‘Inflation Outlook’ January 22, 2019
Crude oil and Crops Outlook
G. Chandrashekhar

2. Crude oil Outlook Market faces many challenges
Highly volatile in 2018; Brent collapsed from early October peak of $ 86 to $ 51; already recovered 20% to $ 60 a barrel;
Market faces many challenges
Bearish factors: Global growth concerns may dampen demand; If trade conflict escalates, demand risks will heighten; U.S. shale output set to continue to expand

3. Crude oil Outlook
Bullish factors: OPEC+ output cut will help rebalance market in 2019;
What if breakthrough in US-China talks?
China stimulus package?
Iranian oil export to decline if U.S. does not extend exemption
Brent: Q1 $ Avg $60; H2 Avg $ 70

4. Crops Outlook 2018-19 Rabi Target (ml t) ; Acreage (ml ha)
Crop Target Area Normal Wheat Rice Pulses NutriCrls Oilseeds

5. Crops Outlook
Concern: Drought in Kar, Mah; Poor soil moisture in north India; Weather risks (El Nino, unseasonal rains); Wheat, maize rule above MSP; Globally agri markets set to be volatile; Weather is key; Fund play; Consolation: FCI stocks comfortable; Wheat 27 ml t; Rice 18.3 ml t; global vegoil prices consumer friendly;

6. What about Currency??
Exchange rate will have bearing on inflation (thro import route);
Where will the Rupee be in Q1, Q2? What about H2?
Will Rupee gain strength if and when U.S. Fed pauses rate hike?

7. Thank You
G. Chandrashekhar Economic Advisor, IMC and Director, IMC-ERTF Phone: