Ethanol Production in India
India is set to achieve its 20% ethanol blending target in petrol within the next two months, producing 1,100 crore litres of ethanol annually, ahead of schedule.
The ethanol will be sourced from sugar, high-grade molasses, FCI rice, broken rice, and maize, with India’s ethanol distillery capacity increasing to 1,600 crore litres.
Sugar will account for about 400 crore litres of ethanol, with 40 lakh tonnes of sugar going towards ethanol production in 2024.
The remaining ethanol will come from other feedstocks like rice and maize.
The government has reduced the price of FCI rice to ₹22.5/kg, enabling the production of 110 crore litres of ethanol from rice, with maize expected to contribute around 400 crore litres.
Role of Maize in Ethanol Production
Maize, previously unused for ethanol, will contribute 9 million tonnes for ethanol in 2024-25.
Major maize-producing states include Karnataka, Madhya Pradesh, Maharashtra, Andhra Pradesh, and others.
Farmers are shifting to maize due to its higher profit for ethanol production.
Maize imports increased in 2024, with ₹100 crore worth imported between April and June.
Economic Impact and Sustainability
The production of maize for ethanol has increased significantly, with an additional 6 million tonnes produced in just three years to meet ethanol demand.
A byproduct of ethanol production, DDGS (Distiller’s Dried Grains with Solubles), is being used as poultry feed, helping prevent disruption in the feed market.
The move to ethanol production is expected to save India ₹6,000 crore annually on oil imports, while providing economic benefits to farmers, boosting local incomes.
With India’s annual oil import bill at ₹10.5 lakh crore, ethanol production can substantially reduce the country’s dependency on imported oil.
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