Workers are seen at a factory of Da Mata, the Brazilian sugar cane processor, in Valparaiso, 355 miles northwest of Sao Paulo in this September 18, 2014 file photo. In a sign of the distortions plaguing Brazil's stagnant economy, a wide range of companies are sharply cutting back output of their main products to instead sell electricity back into the national grid because it is more profitable. The trend includes sugar, ethanol, steel, aluminum and chemical companies, a Reuters analysis of company earnings statements and other guidance shows.Tax incentives and historically high electricity costs mean Brazilian factories are more likely than their peers in many other countries to produce their own energy. They sometimes burn biomass or use gas or even privately built hydroelectric dams. Picture taken September 18, 2014. REUTERS/Paulo Whitaker/Files (BRAZIL - Tags: BUSINESS TRANSPORT COMMODITIES ENERGY ENVIRONMENT) | Photo Credit: Paulo Whitaker
Against the backdrop of massive sugar production this season the sugar industry wants the government to buy ethanol produced by blending of sugar in B heavy molasses at a rate of ₹62.65 per liter.
Union Transport Minister Nitin Gadkari, who is also the MSME Minister, has recently submitted the proposal to the Centre and has asked the Maharashtra government to approach the Centre with a similar demand.
“There is a huge stock of sugar in Maharashtra. I have recently submitted a proposal and the Maharashtra government must pursue it with the Centre,” Gadkari said.
He was speaking in an online programme organised to inaugurate medical oxygen plant started by the Dharashiv Sugar Mills in Osmanabad district.
He said that about 15-20 per cent sugar could be added to B heavy molasses to produce ethanol. “The rate for ethanol produced using sugarcane juice is about ₹60 per litre. If the Petroleum Ministry gives the same rate to ethanol produced by adding sugar to B heavy molasses, about 25 lakh tonnes sugar in Maharashtra could be used for the purpose,” said Gadkari.
“In this case, the sugar mills will get rate of ₹36 per kg for sugar and mills will not have to pay heavy charges for stocking up sugar in godowns,” he said.
Blending target
The government is targeting 20 per cent blending of ethanol with petrol as a part of the National Policy on Biofuels (NBP). To meet this target and the requirement of chemical and other sectors, about 1,200 crore litres of alcohol/ethanol would be required. About 900 crore litres would be required to achieve 20 per cent blending and 300 crore litres would be the requirement of chemical and other sectors, according to the Ministry of Petroleum and Natural Gas.
The Ministry estimates that of the total requirement of 1,200 crore litres, 700 crore litres are required to be supplied by the sugar industry and the rest by grain-based distilleries.
To produce 700 crore litres of ethanol by sugar industry, about 60 lakh tonnes (lt) of surplus sugar would be diverted to ethanol which would solve the problem of excess sugar, relieve the industry from the storage o glut and improve the revenue realisation of sugar mills. This will facilitate mills in making timely payment of cane dues of sugarcane farmers.
The sugar industry hopes that Gadkari’s proposal would be accepted. “ The sugar industry is facing a tough challenge with massive production. Many mills will not be able to pay FRP to farmers if sugar stock remains in godown,” said a senior industry captain.
The ex-mill ethanol price for C-heavy molasses is ₹45.69 per litre, while for B heavy molasses it is ₹57.61. For ethanol produced from sugarcane juice, sugar and sugar syrup, the price is ₹62.65.
Published on May 17, 2021
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