India permits ethanol production using sugarcane juice and molasses.

Ethanol Production in India

• New Regulations: The Indian government has announced that starting from the 2025/2026 marketing year, there will be no restrictions on the volume of ethanol produced from sugarcane juice, syrup, and all types of molasses. This change comes after restrictions were imposed in the current marketing year due to a decline in sugarcane supplies.

• Ethanol Supply Year: Beginning November 1, sugar mills and distilleries will be permitted to produce ethanol without any quantitative limits, as stated by the Ministry of Consumer Affairs, Food & Public Distribution.

• Sugarcane Supply Outlook: The supply of sugarcane is expected to increase significantly due to favorable monsoon rains over the past two years, which have allowed farmers to expand the area dedicated to sugarcane cultivation.

Industry Response

• Industry Feedback: A sugar miller from Maharashtra expressed that the government's decision is positive, suggesting that the ethanol procurement price should be raised to enable mills to compensate farmers at the government-fixed cane price.

• Increased Production Capacity: Major Indian sugar mills, including E.I.D.-Parry, Balrampur Chini Mills, Shree Renuka, Bajaj Hindusthan, and Dwarikesh Sugar, have been ramping up their ethanol production capacity in recent years.

Government Goals

• Ethanol Blending Target: India, being the third-largest oil importer and consumer of petroleum products, aims to achieve a 20% blending of ethanol into gasoline by the 2025/2026 period, aligning with its broader energy and sustainability goals.