Cooperative sugar mills seek ethanol price revision as blending dips to 28%

Closing sugar stocks now estimated at 4.8 million tonnes in 2024-25

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The cooperative sugar industry has demanded a revision of ethanol procurement prices and extension of blending targets beyond 20 per cent. This comes as sugar’s contribution to the national ethanol programme has declined sharply from 73 per cent to 28 per cent.

 

The cooperative mills also believe that India’s closing sugar stocks in the 2024-25 season, which will end in September 2025, will be around 4.86 million tonnes. This would be good enough to meet domestic requirements for October-November 2025.

 

Earlier, there were apprehensions among a section of the industry as to whether the country will have adequate sugar during the crucial festival months. This was due to the almost 20 per cent drop in production this year compared to the 2023-24 season.

 

“Currently, the ex-mill sugar prices remain stable, ranging between ₹3,880 and ₹3,920 per quintal. This stability is supported by lower net production, strong market demand, and timely-government interventions — notably the strategic allowance of limited sugar exports and controlled release of monthly domestic quotas. These have led to the balanced supply in the domestic market,” said the National Federation of Cooperative Sugar Factories (NFCSF), in a statement on Monday.

 

The industry has also demanded accelerated promotion and manufacturing of flex-fuel vehicles (FFVs) to boost ethanol demand and ensure market preparedness for higher blending. 

 

The demand was made by the industry delegation, led by Ravi Gupta, chairman of IFGE's Sugar Bioenergy Group, and expert member on the Board of NFCSF, in a meeting held at the Prime Minister's Office recently, it said.

 

In the 2022-23 season (October 2023-September 2024), NFCSF said the sugar industry reached a milestone by diverting 4.3 million tonnes of sugar towards ethanol production. This enabled the supply of 3.69 billion litres of ethanol, which accounted for 73 per cent of the total ethanol blended with fuel across the country.

 

However, in 2023-24, ethanol supply from sugar-based feedstock declined to 2.7 billion litres, contributing only 38 per cent to the national blending programme.

 

“This is projected to fall further to 2.5 billion litres in 2024-25, making up just 28 per cent of the total blending target of 9 billion litres,” NFCSF said in the statement.

 

The main reason for this fall is that ethanol procurement prices have not been increased in line with the rise in fair and remunerative price (FRP) of sugarcane. This is making ethanol production less profitable for sugar mills. 

 

Govt must deregulate fertiliser prices: Expert

 

The government should reset its fertiliser policy by deregulating prices and allowing farmers to choose between chemical and non-chemical fertilisers, agriculture economist Ashok Gulati said on Monday.

 

The current policy has created a massive imbalance in fertiliser use, causing soil damage due to excessive use of heavily subsidised urea amid lacking subsidy support for zinc and other soil nutrients, said Gulati, former chairman of the Commission for Agricultural Costs and Prices (CACP).

 

“Deficiency of zinc in soils is leading to deficiency of zinc in wheat and rice, leading to stunting among children. This is a major nutritional issue,” Gulati said.

 

He was speaking on the sidelines of an Indian Council for Research on International Economic Relations event on ‘Improving Soil Health for Better Crop and Human Nutrition.’