For FY 2021-22, Government has decided to continue the price of FCI rice to Rs 2000/quintal for the production of ethanol.
With a view to supporting the sugar sector and in the interest of sugarcane farmers, the Government of India has recently allowed the production of ethanol from B-Heavy Molasses, sugarcane juice, sugar syrup, and sugar; and encouraging sugar mills to divert excess sugarcane to ethanol. In the previous sugar season, 2019-20 about 9 LMT of sugar was diverted to ethanol.
In the current sugar season 2020-21, it is likely that more than 20 LMT of excess sugar would be diverted to ethanol. By 2025, it is targeted to divert 50-60 LMT of excess sugar to ethanol, which would solve the problem of high inventories of sugar, improve the liquidity of mills thereby help in timely payment of cane dues of farmers. In the past three sugar seasons about Rs 22,000 crore revenue was generated by sugar mills/distilleries from the sale of ethanol to OMCs.
The government has fixed the price of ethanol from maize as Rs 51.55/litre & rice available with FCI as Rs 56.87/litre for ethanol supply year 2020-21. For FY 2020-21, Government has fixed the price of FCI rice to Rs 2000/quintal for production of ethanol. For FY 2021-22, Government has decided to continue the price of FCI rice to Rs 2000/quintal for the production of ethanol.
Production of ethanol would not only facilitate diversion of excess sugar to ethanol but would also encourage farmers to diversify their crops to cultivate particularly maize which needs lesser water.
