Sugar mills making more from molasses

With ethanol prices fixed, mills sell to liquor firms

Sugar mills expect higher realisation from non-ethanol byproducts, molasses and rectified spirit, than processing them for ethanol for fuel doping.

Liquor manufacturers pay Rs 46-47 a litre for rectified spirit and the realisation from ethanol has declined by Rs 7-8 a litre due to a cut in its price and withdrawal of excise duty concession. Oil refiners face a price ceiling on ethanol but liquor manufacturers pay the market price for rectified spirit.

The situation has prompted small sugar manufacturers to sell molasses, a raw material for rectified spirit. But distilleries producing ethanol are taking a hit on their profits.