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Informist, Tuesday, Aug 13, 2024

 

--Source:Govt may reimpose cap on sugar diversion for ethanol 2024-25

--CONTEXT: Sugar diversion for ethanol capped at 2.5 mln tn 2023-24  
--Source:Govt may announce cap on sugar diversion for ethanol Aug end 

 

 By Afra Abubacker

 

NEW DELHI – The government is likely to impose an upper limit on the amount of sugar to be diverted for ethanol production from cane-based feedstocks for 2024-25 ethanol supply year (Nov-Oct), a senior official told Informist. An announcement on this is likely by month-end, he added.

 

In the ongoing ethanol supply year, the government allowed only 2.5 mln tn of sucrose to be diverted for ethanol to ensure sufficient availability of sugar in the country. In 2022-23, India diverted about 4 mln tn of sugar for ethanol supply.

 

"The government may allow sucrose diversion for ethanol (next year), keeping in view good monsoon and sufficient sugar availability in the country," the official said, without disclosing the likely upper limit on sugar diversion for ethanol. 

 

The Indian Sugar Mills & Bio-Energy Manufacturers Association has pegged sugar availability in the upcoming sugar season starting in October at 42.35 mln tn, with an opening stock of 9.05 mln tn and sugar output without diversion to ethanol at 33.31 mln tn, according to a press release on Jul 30. India's annual sugar consumption demand is 29.0 mln tn. 

ISMA did not detail sucrose diversion for the upcoming season, as the government has not yet announced its ethanol policy for sugarcane feedstocks for the next season. 

 

Asked if the government would resume ethanol production from sugarcane juice and B-heavy molasses in 2024-25, the official said, "Ethanol production from C-heavy (molasses) is going on. Discussions are currently ongoing on whether to allow B-heavy and cane juice (for ethanol output)."

 

The industry has been urging the government to clarify whether the restrictions on sucrose diversion will continue in the next season as well. It has also been demanding a hike in prices of ethanol made from sugarcane by-products. 

 

The government, in December, had capped sugar diversion for ethanol production in the 2023-24 ethanol supply year at 1.7 mln tn. However, as of Apr 15, sugar output was at 31.1 mln tn, down merely 0.5% on year. As a result, the government allowed additional sugar diversion for ethanol production, capping it at around 2.5 mln tn.

 

Ethanol is made from starch-containing feedstocks like molasses and grains. Sugarcane juice, B-heavy molasses, and C-heavy molasses are sugarcane by-products obtained during sugar extraction.

 

Oil companies buy ethanol to blend with petrol to promote green mobility and achieve blending targets. To reduce dependence on crude oil, the government has set a target of achieving 15% blending of ethanol with petrol in 2023-24, 18% in the subsequent year, and 20% in 2025-26. India has so far achieved 13% blending as of Jul 1 in the ongoing ethanol supply year ending October. End

 

Edited by Tanima Banerjee

 

 

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