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Informist, Tuesday, Aug. 26, 2025

 

By Afra Abubacker and Pallavi Singhal 

 

MUMBAI/NEW DELHI – The Food Corp. of India has so far sold 2.2 million tonnes of rice to distillers for ethanol production in 2024–25 (Nov-Oct), an FCI official said. This accounts for 42% of the 5.2 million tonnes of rice earmarked for biofuel production. 

 

Even as only two months are left for distillers to complete their purchase, rice offtake continues to be poor. The average daily offtake of rice is around 12,000 tonnes, the FCI official said. "At this pace, the remaining quantity cannot be lifted within the next 60–65 days," the official added.

 

Distillers have received allotment letters for about 4.0 million tonnes of rice. To clear the remaining 1.8 million tonnes before October-end, the daily purchasing pace would need to rise to about 30,000-40,000 tonnes on average, the official mentioned above said.

 

According to experts, rice offtake for ethanol production has been slow due to operational issues such as delayed allocation announcements and late issuance of allotment letters. 

 

To liquidate the surplus rice lying in government godowns, the Centre had earlier increased the rice allocation for ethanol production by 2.8 million tonnes, taking the total allocation target for distillers to 5.2 million tonnes. However, with the 2024-25 ethanol supply year ending in October, rice demand from distillers is unlikely to pick up as oil marketing companies have closed ethanol supply orders. 

 

As of Jun. 1, rice stocks in the central pool stood at a two-decade high of 38 million tonnes on the back of record procurement and state-level bonuses over the minimum support price.

 

FCI expects rice sales through auction under open market sales to pick up in 2025-26 (Apr-Mar). The corporation offloads rice through online auctions and direct sales without auctions. "We expect rice sales to rise substantially and amount to almost 10 million tonnes by the end of the ongoing financial year," an FCI official said. These sales witness three types of participants – market players who buy via e-auctions, state governments who buy to fuel their welfare schemes, and ethanol makers.

 

FCI is currently offering rice to distillers at a subsidised price of INR 2,250 per 100 kg, against its economic cost of INR 3,975 per 100 kg. For the upcoming ethanol supply year, the government has allocated 5.2 million tonnes of rice, in line with the current year. From Nov. 1, FCI will sell surplus rice to distillers at a revised rate of INR 2,320 per 100 kg.  End

 

Edited by Tanima Banerjee

 

 

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