Petroleum Companies to Procure 3.91 Billion Liters of Ethanol from Sugar Industry in 2024-25

For the Ethanol Blending Program (EBP) in petrol, petroleum companies will purchase 9.71 billion liters of ethanol during the ethanol supply year 2024-25. Of this, 3.91 billion liters will be procured from the sugar industry, including ethanol produced directly from sugarcane juice, as well as from B-heavy and C-heavy molasses. The remaining 5.74 billion liters will come from ethanol produced from food grains.

According to industry sources, 2.33 billion liters of ethanol will be sourced from sugarcane juice. Additionally, 1.47 billion liters will be produced from B-heavy molasses, while 110 million liters will come from C-heavy molasses.

The highest amount of ethanol will come from maize, with a target of 4.74 billion liters, which exceeds the ethanol supplied by the sugar industry. Ethanol from damaged grains, primarily rice, is set at 1 billion liters, bringing the total ethanol supply from food grains to 5.74 billion liters.

Industry sources indicate that the government may allow the use of 4 to 4.5 million tons of sugar for ethanol production during the 2024-25 crushing season.

However, the target for maize-based ethanol production is not feasible. A large portion of maize production is used for poultry feed and animal fodder. If the set target for maize-based ethanol is met, it may lead to the need for maize imports. In 2023-24, India produced 37.665 million tons of maize, while the production was 38.085 million tons in 2022-23 and 33.73 million tons in 2021-22.

Maize prices have improved over the past two years. This year, maize prices stayed above the minimum support price (MSP) for most of the time, reaching up to ₹2,800 per quintal due to increased demand from ethanol producers. The MSP for maize was set at ₹2,090 per quintal in 2023-24 and has been increased by ₹135 to ₹2,225 per quintal for 2024-25.

Due to rising prices, the poultry industry had earlier requested the import of 3 million tons of maize, recommended by the Secretary of the Ministry of Animal Husbandry, Alka Upadhyay. Although the import did not happen, similar demands could arise again in the future. Industry sources, however, believe the maize target is not practical.