The central government has lifted restrictions on ethanol production from sugarcane juice or sugarcane and mandated petroleum companies to procure ethanol worth approximately three thousand crores from factories nationwide. Petroleum companies have initiated the procurement process for ethanol valued at around 1100 crores in the state, with tenders already issued, as per a senior ministry official.
To prevent sugar shortages and price fluctuations, the central government had banned ethanol production and purchase from sugarcane juice and B-heavy molasses on December 6, 2023. At the time of the ban, there was a surplus of about five to seven lakh tones of molasses (B-heavy molasses) in the country. In Maharashtra alone, sugarcane juice and sugarcane worth around 1100 crores have been in stock for the past six months. Failure to convert this stock into ethanol promptly will lead to wastage.
The State Sugar Association and the National Cooperative Sugar Mills Federation had urged Prime Minister Narendra Modi to permit ethanol production before the expiration of its utility. State Sugar Association President P.R. Patil and Managing Director Sanjay Khatal highlighted this issue to the government. National Cooperative Sugar Factory Federation President Harshvardhan Patil also met Cooperative Minister Amit Shah, requesting the removal of ethanol production restrictions. Shah had assured at that time to consider the matter post the sugar season's conclusion.
Following the conclusion of the sugar season, the restrictions have now been lifted, and petroleum companies have been directed to procure ethanol produced from sugarcane juice and sugarcane available at the factories nationwide. Indian Oil Corporation, Bharat Petroleum, Hindustan Petroleum, and Mangalore Refinery and Petrochemicals Ltd. have issued a tender to purchase approximately 66 crore liters of ethanol in the initial phase, with factories required to submit their tenders. Currently, factories aim to produce ethanol from the remaining sugarcane and sugarcane juice and supply it to oil companies. Factories will need to pay the applicable rate through the tender process, bringing relief to the sugar industry, according to Sanjay Khatal, Managing Director of Sakhar Sangh.
