Sources said that the government will bring out a fresh notification soon specifying the quantity of sugarcane juice and molasses that can be used for ethanol production for this season.

 

The Union food ministry last week directed all sugar mills and distilleries to stop using sugarcane juice for production of ethanol for 2023-24 season (October-November), in order to ensure adequate supply of sweetener for domestic consumption, and prevent any hike in its retail prices.

 

This move is expected to release 1.8-2 MT of sugar additionally in the domestic market which would help curb rise in prices amidst reports of fall in sweetener output in Maharashtra and Karnataka this season.The food ministry in a communication to managing directors and chief executive officers of all sugar mills and distilleries, said that supply of ethanol to oil marketing companies from B-heavy molasses will continue.

 

Meanwhile, Aditya Jhunjhunwala, president, ISMA said as of current projection, the country’s sugar production in 2023-24 season is estimated at 32.5 MT while domestic consumption would be around 28.5 MT.“With the open stock of 5.8 MT with mills at the beginning of October, there will be sufficient sugar stock for additional ethanol production,” Jhunjhunwala said, adding that it had urged the government to review the production scenario next month.

 

ISMA had estimated sugar production for 2022-23 season at 36.61 MT, which excludes diversion towards ethanol production.He said with the ban on use of sugarcane juice, about 20 mills manufacturing ethanol from juice from a total of 157 mills engaged in production of biofuel from sugar has been hugely impacted.

 

“With the lowest sugar prices in the world, no sugar export this years and ban on ethanol production from sugarcane juice, industry is facing difficulties on timely payment to farmers,” Jhujhunwala said by adding that industry has invested Rs 14,000 crore – Rs 15,000 crore in ethanol manufacturing from sugarcane.In ESY 2022-23, the country has achieved 12% ethanol blending in petrol by production of 5 billion litres of ethanol. The target for blending aim for ESY 2023-24 is 15% per cent, for which the oil marketing companies (OMCs) would need to acquire around 7 billion litres of ethanol.

 

According to industry sources, around 25% of ethanol is produced from sugarcane juice and sugar syrup, while around 45% comes from B-heavy molasses–a sugar processing byproduct with substantial sugar content. Around 25% of ethanol is produced from the grain based sources. Under the national policy on biofuels of 2018, the government had advanced the target of 20% blending of ethanol in petrol to 2025-26 from 2030.