Govt approaches NITI for 25% ethanol blending road map, may hike sugar MSP

Says Centre considering demands of sugar sector

With the target of 20 per cent ethanol blend with petrol on track, the food ministry has now approached the NITI Aayog to prepare a road map for 25 per cent blending, Food Minister Pralhad Joshi said on Thursday.

He said that in the 2023-24 Ethanol Supply Year that will end in October, the country has so far achieved close to 14 per cent national average blending of ethanol with petrol.

Joshi also said that the Centre is considering the demands put forward by the domestic sugar sector, including hiking the minimum selling price of sugar from the current level of Rs 31 per kg, a new procurement price for ethanol for OMCs, and exports of sugar.

 

“We are looking at the sugar production numbers for the 2024-25 season that will start in October before coming to any conclusion on exports. The industry has given us some numbers while we have our estimates based on all the inputs,” Joshi told reporters on the sidelines of the India Sugar and Bio-Energy Conference organized by ISMA (Indian Sugar and Bio-Energy Manufacturers Association).

India last allowed large-scale sugar exports in the 2022-23 season when it was capped at 6.4 million tonnes.

A year before that, in 2021-22, sugar exports topped 11 million tonnes, which was the among the highest ever.

Joshi also said sugar production looked good for the 2024-25 season (October to September) on account of good monsoon.

Ethanol prices, fixed by the government, have not been hiked since the 2022-23 ethanol supply year (November-October).

Currently, ethanol produced from cane juice is priced at Rs 65.61/litre, while rates for ethanol from B-Heavy and C-Heavy molasses stand at Rs 60.73/litre and Rs 56.28/litre, respectively.

Earlier, addressing the conference, food secretary Sanjeev Chopra said that with monsoons being good, the industry is expecting a very good sugarcane crop in 2024-25.

He said due to proactive policies of both the government and the sugar sector, sugarcane arrears in the 2023-24 season have reached an all-time low and over 99 per cent of the dues have been settled.

“Recently, the government also removed the restrictions that were imposed on manufacturing of ethanol from B-Heavy molasses and sugarcane juice as we have been saying from day one that this is a temporary measure,” Chopra said.

“Studies conducted jointly by ICAR bodies and others show that one litre of ethanol manufactured from sugarcane consumes 3,300 litres of water, while that made from maize consumes 4,760 litres and from rice consumes 10,760 litres of water. Hence, sugarcane is a very efficient crop when it comes to making ethanol,” he said.

Sugar industry objects to byproduct controls, pushes for exports 

The sugar industry expressed concerns over the inclusion of by-products such as molasses into the draft amendments to the Sugar Control Order of 1966 that was floated by the government for suggestions last month. Meanwhile, ISMA vice-president said the association has put forward a demand for the export of 2-2.5 million tonnes of sugar in the 2024-25 season that will begin next month.

“There are some provisions in the draft such as bringing by-products produced during the process of making sugar such as molasses within the purview of the act, which gives a sense that the amendments seek to bring back controls to which we have raised our objection to,” M Prabhakar Rao, president of Indian Sugar and Bio-Energy Manufacturers Association (ISMA) said.

The last date for submission of comments to the draft was September 23.

Meanwhile, ISMA vice-president Gautam Goel said the association has put forward a demand for the export of 2-2.5 million tonnes of sugar in the 2024-25 season that will begin next month.

“Our initial estimate for gross sugar production in 2024-25 was 33.3 million tonnes, which was marginally less than this year but given that the rains have been good this year, we expect it to be revised upward in the next few months,” he said.