India’s sugar industry is raising concerns over recent changes in the government’s ethanol blending program, which was once a major boost to the sector. After investing heavily in ethanol production, sugar companies now worry that their product is being sidelined in favor of grain-based ethanol.
What’s the issue?
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A few years ago, sugar mills were supplying about 70% of the ethanol used in the national fuel blending program.
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Today, that share has dropped to just 30%, with grain-based ethanol making up the difference.
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This shift hurts sugar mills financially, affects their ability to pay farmers on time, and leaves newly built ethanol production facilities underused.
Industry leaders speak out:
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Atul Chaturvedi, Executive Chairman of Shree Renuka Sugars, said the sugar sector invested heavily in ethanol production based on the government’s plan that 55% of ethanol would come from sugar and 45% from grain.
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Now, with much lower allocations, companies are struggling to repay loans and fear the industry could slide into financial trouble again.
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He urged the government to restore the original balance, especially since a good sugarcane crop is expected this year.
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Ankita Patil, Director at Indreshwar Sugar Mills, warned that if this trend continues, sugar mills will lose the financial cushion ethanol used to provide.
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She said molasses prices would drop, ethanol income would fall, and the industry would become more vulnerable to global sugar price swings.
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She emphasized that long-term planning and stable government policy are crucial for the sector’s survival.
