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Informist, Wednesday, Apr. 2, 2025

 

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--IB Group's Jain: Govt increasingly betting on maize for ethanol blending
--IB Group Jain:Maize output must grow 12-15% annually to meet ethanol demand
--CONTEXT: IB Group Senior Vice-President Arpit Jain's comments in interview
--IB Group Jain: See maize output in year ending June at 34.5 mln tn
--CONTEXT: Govt has set maize production target for year to June at 40 mln tn
--IB Group's Jain sees maize output at 65 mln tn to 70 mln tn over next 6 yrs
--IB Group's Jain:Genetically modified maize only viable option to up output
 

 

By Pallavi Singhal and J. Navya Sruthi

 

NEW DELHI/MUMBAI – IB Group, which is engaged in poultry, livestock feed, edible oils, and processed chicken industry, sees India's maize production in 2024-25 (Jul-Jun) at 34.5 million tonnes, up 17% from 29.5 million tonnes estimated for 2023-24 but short of the government's target of 40 million tonnes, says Arpit Jain, senior vice president, energy procurement-grains. Due to rising demand from the ethanol sector, the country's maize output is likely to reach 65 million tonnes to 70 million tonnes over the next six years, Jain said.

 

"Maize production in India should see an annual growth of 12-15%," he said in an e-mail communication to Informist. As demand for maize grows, Jain sees limited horizontal expansion of the crop, as he is of the opinion that the country cannot afford to replace other crops beyond an extent. "The only viable option (therefore) would be vertical growth, which is enhancing yields," he said.

 

Citing the stagnant yields at 3.5 metric tonnes of maize per hectare in India, when the global average is 6.5 metric tonne per hectare, Jain said, "genetically modified maize is likely an inevitable solution."

 

The country's maize output for 2023-24 (Jul-Jun) was pegged at 37.7 million tonnes. For the current crop year, the government has estimated maize production in the kharif season at 24.8 million tonnes and that in rabi season at 12.4 million tonnes. The government is yet to give the production figures for maize in summer.

 

Commenting on aflatoxin, Jain said the ethanol industry can consider developing two production lines: one for maize with permissible toxin levels to supply to the domestic poultry feed industry and for exports, and another with higher toxin levels to be used elsewhere. "This approach would help maximize value realisation and minimize the impact of toxic material, which currently limits profitability."

 

Aflatoxins are produced by the fungi Aspergillus flavus and Aspergillus parasiticus, which occur on maize crop due to plant stress especially during periods of drought, heat or insect damage. Aflatoxins can pose threat to human and animal health potentially leading to liver damage and increased cancer risk. A major co-product of ethanol production, particularly in maize-based ethanol plants, is distillers grains, which are a high-protein and nutritious animal feed. Ethanol production also generates other valuable co-products, such as corn oil, which can be used as a feed ingredient or as a biodiesel feedstock.

 

Following are edited excerpts from the interview:

 

Q. What is your estimate for maize production in 2024-25 (Jul-Jun)? The government's target is 40 million tonnes.

A. Our estimate for maize output in 2024-25 (Jul-Jun) is around 34.5 million tonnes, which is slightly below the government's target of 40 million tonnes.

 

Q. Prices of maize were at an all-time high last year which led to higher acreage this year. Now that prices are steady with downward bias and prices have been rangebound so far this year, do you see maize production increasing next year or any shift from maize to other plants?

A. Yes, maize production is expected to maintain its pace in the coming years. Maize continues to offer the best net returns for farmers, with relatively low risks compared to other crops, especially in terms of weather, crop damage, and yields. This makes maize a highly profitable choice, ensuring its strong presence in the agricultural landscape despite price fluctuations.

 

Q. Does the poultry sector still want the government to reduce the import duty on maize? Why?

A. The poultry sector advocates reducing the import duty on maize only during shortage situations, with a targeted duty exemption mechanism like a Tariff Rate Quota. This approach ensures that imports are allowed when there is a significant shortfall, enabling timely and efficient execution of imports to meet demand without disrupting the market. Therefore, the government should establish a policy that activates such measures during critical shortages.

 

Q. With demand from the ethanol sector easing because of availability of Food Corp. India's rice and substitutes for poultry feed, how much more will India's maize production grow? What is your long-term outlook?

A. While the current year's FCI rice stocks are excessive, this may not be the case in the coming years. In the long run, the government is increasingly betting on maize, particularly for the ethanol sector. Maize production in India should see an annual growth of 12-15%. Over the next six years, we can expect India's maize output to reach 65-70 million tonnes.

 

Q. With the advent of ethanol, poultry sector has been undergoing a change as well, as feed moves from maize and soybean to distillers dried grains with solubles (DDGS). Do you see the consumption of DDGS growing and getting independent of maize? Why?

A. Yes, DDGS is currently the most affordable protein source for the feed industry. In the coming years, DDGS will increasingly replace soybean meal to meet the protein requirements in poultry feed, but it will not reduce dependence on maize. Maize continues to serve the energy needs of feed, which will remain unchanged. Meanwhile, DDGS will primarily fulfil the protein needs of feed, replacing soybean meal in a significant way. Therefore, both maize and DDGS serve distinct and complementary purposes in poultry feed.

 

Q. Aflatoxin is a problem that is not being talked about enough. Can you elaborate on how widespread it is and the problems it causes?

A. Aflatoxin is a significant challenge that needs more attention. It becomes problematic when aflatoxin levels exceed 20 ppb (parts per billion), as it is not allowed in the feed industry. The issue originates from maize itself, not from the ethanol production process. Aflatoxin contamination can lead to serious health risks for both livestock and humans, affecting animal growth and overall productivity.

 

Q. What can be a solution to tackle aflatoxin?

A. To tackle aflatoxin, ethanol plants should prioritise high-quality maize procurement. Specifically, the grain count per 100 grams should be low (around 300-320), and fungus presence should be minimal (under 2%). (A higher grain count per 100 grams suggests smaller kernels, which may be more susceptible to fungal growth and aflatoxin contamination)

 

Regular aflatoxin testing, ideally on a daily basis, is essential. Additionally, the ethanol industry could consider developing two production lines: one for maize with permissible toxin levels to supply the poultry feed industry and export markets, and another with higher toxin to be used elsewhere. This approach would help maximize value realization and minimize the impact of toxic material, which currently limits profitability.

 

Q. One thing that was talked about throughout the maize summit held last week was genetically modified maize. Do you see genetically modified maize as inevitable? What are your thoughts on the market for genetically modified maize in India and what can policymakers do to help?

A. Given the growing demand for maize, it's becoming clear that horizontal expansion is limited. We cannot afford to replace other crops with maize after a certain extent, so the only viable option is vertical growth by enhancing yields. Currently, India's maize yield is 3.5 metric tonne per hectare, compared to the global average of 6.5 metric tonne per hectare, indicating a significant gap.

 

Therefore, genetically modified maize is likely an inevitable solution. We need to adopt a more open-minded approach towards genetically modified technology. Overcoming the reluctance to use genetically modified seeds in India will be beneficial both for farmers, who will see improved yields, and for the industry, which will become more competitive in global export markets. Policy makers can play a crucial role by creating a conducive environment, offering clear regulations, and supporting research to help integrate genetically modified maize into India's agricultural landscape.

 

Q.  At a time when the maize sector in India, still at its nascent stage, is seeing rapid growth, what role do you see policymakers playing in it? Does the sector want a maize specific policy? What components would you want addressed in such a policy?

A. As the maize sector in India continues to grow rapidly, it is crucial for maize-dependent industries such as poultry, starch, and ethanol to come together on a common platform to present their concerns to the government. A unified voice, backed by shared data and common issues, will encourage the government to address the sector's needs more effectively.

 

The sector does indeed need a maize-specific policy. This policy should be developed with inputs from industry stakeholders and should include clear, actionable plans for critical situations, with defined triggers and corresponding solutions for both farmers and the industry. Such a policy would provide greater clarity across the entire maize supply chain, reduce unnecessary speculation, and foster a more stable and transparent environment for growth.  End

 

Edited by Ashish Shirke

 

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