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Informist, Wednesday, Dec. 18, 2024

NEW DELHI – India has turned into a net importer of maize amid rising competition from the poultry feed and biofuel industries, industry experts said. "The food-feed-fuel competition is rising, and we might become a structural importer of maize," Nitin Gupta, senior vice president, Olam Agri, said at the World Grains Conference here on Wednesday. The government has pushed maize as the go-to feedstock for ethanol production.

 

However, ethanol distilleries have been facing feedstock supply challenges amid the limited supply of maize and competition from the poultry industry. India is set to import a record 1 million tonnes of maize this year, according to trade estimates. 

 

Faced with maize shortage, is importing ethanol a viable option? "Importing ethanol is very counter-intuitive. EPB (ethanol blending programme) was meant to reduce crude oil imports," Ashish Chaturvedi, general manager, Olam Agri said. India's ethanol imports from the US rose 200% on year to 564.9 million litres in Jan-Aug from 188.3 million litres in the same period last year, according to the Energy Information Administration.

 

India imported ethanol this year as a last resort to meet the blending mandate. But in the long term it is not viable to import ethanol, Chaturvedi added. The ethanol industry has committed to supplying more than 4 billion litres of ethanol sourced from maize. Amid the limited supply of maize, distilleries are bound to default and invite penalties, Chaturvedi said. "And the government will have to waive it off," he added.

 

Speaking at the conference, GK Sood, a farm expert, said the government has to spend more on agricultural research and cut down the food subsidies and funds for the Food Corp. of India's operations to achieve self-sufficiency in pulses and food grains.

 

The government is sensitive about wheat imports as it does not want to risk farmer disappointment, Garima Jain, deputy CEO, Louis Dreyfus Co., said. However, the government may find that "micromanaging the distribution matrix of wheat and rice" will change when the economy grows and consumption demand rises, she added.

 

Though the private pipeline of wheat is squeezed, the government has not hinted at any inclination to cut the 40% import duty and encourage wheat imports, Sood said. Instead, the government further reduced the quantity of wheat stock limits to control rising prices, he added.  End

 

Reported by Afra Abubacker

Edited by Saji George Titus

 

 

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