To meet the rising demand for medical oxygen to treat Covid-19 patients, about 70 sugar mills in Maharashtra are gearing up for manufacturing oxygen.

“This is a timely step taken by mills in Maharashtra. About 25 mills are already in the process to set up oxygen plants and we are focusing on about 60-70 sugar mills that have financially performed very well. Majority of these mills are in rural areas and the demand for oxygen here could be met by sugar mills,” said Prakash Naiknavare, MD, National Federation of Cooperative Sugar Factories (NFCSF).

He added, “Mills will need to modify distilleries for oxygen manufacturing. Also, mills will have to take care that the commitments of ethanol supply are met. With oxygen manufacturing, mills are shouldering social responsibility. Also, this could be a business model for the mills.”

Naiknavare added that NFCSF is going to discuss oxygen manufacturing with sugar mills in other States.

Orders pour in

BB Thombare, President of West Indian Sugar Mill Association (WISMA), told BusinessLine that 15 mills including private and cooperative mills have placed orders for skid-mounted oxygen manufacturing units. “We have approached manufacturers in China, Taiwan as local manufacturers said they would require 8-10 months to fulfil the orders. Each plant has the capacity to refill 90-100 oxygen cylinders daily which will be provided to government and private hospitals at a nominal price,” said Thombare.

He added that mills have placed orders for 600 oxygen concentrators.

WISMA has appealed to sugar mills aross the country to set up one plant each and procure 25 oxygen concentrators to meet the oxygen requirement in their localities.

Recently, Nationalist Congress Party (NCP) Chief Sharad Pawar had held a meeting of millers to discuss oxygen manufacturing in mills. Of the 190 sugar mills that started crushing this season in Maharashtra, 167 mills have closed their crushing operations and 23 sugar mills are still operating.

Business model?

Last year, as Covid-19 cases multiplied, many sugar mills started sanitiser manufacturing. According to industry players, mills benefited from sanitiser manufacturing despite selling the product at minimal rates.

According to some of the key players in the industry, sugar mills have no system to manufacture oxygen and need molecular sieve modification in ethanol plant for filtering oxygen. “What happens to the investment when there will be no demand for medicinal oxygen?,” one of the senior industry players reiterated speaking to BusinessLine.

Vasantdada Sugar Institute (VSI) headed by Sharad Pawar, NFCSF and WISMA are together working on a long-term plan on oxygen manufacturing so that mills continue to be in the business even after the demand for medical oxygen recedes.