The Indian Sugar Mills Association (ISMA) has urged the Union government to permit the diversion of an additional 10-12 lakh tonnes (lt) of sugar for ethanol production in the current season over and above the 17 lt already permitted in view of a sugar production being higher than initially estimates.

In view of an estimate of lower sugar production in Maharashtra and Karnataka, the Centre has taken several steps including capping sugar diversion for ethanol for the current season (October 2023-September 2024)

The industry body of private sugar mills also has asked the government to immediately announce an upward revision in the procurement cost of ethanol produced from sugarcane juice/syrup and B-heavy molasses for 2023-24 ethanol supply year (November-October).

Sops for maize-made ethanol

The government had recently announced an incentive for ethanol made from maize and from C-heavy molasses. But since the sugarcane crop is more efficient in terms of water, nutrient, land use or carbon sequestration compared to maize, sugarcane also deserves to be supported more by the government, ISMA said.

The new price of ethanol from C-heavy molasses has been fixed at ₹56.28 per litre, up from ₹49.41 in the previou season.

India achieved the target of 12 per cent blending of ethanol with petrol in ESY 2022-23 and 10 per cent blending in ESY 2021-22. The Ministry of Petroleum and Natural Gas (MoPNG) has set a target of achieving 15 per cent blending in ESY 2023-24.

Output down 5.28%

Meanwhile, according to ISMA, mills have manufactured 149.52 lt of sugar until January 15 in on-going season that started from October 1, 2023, down by 5.28 per cent from 157.87 lt in the year-ago period. ISMA will bring out its second estimate of sugar production for entire season by the end of this month.

“As per reports, recent weather has been favourable for the standing cane crop and cane commissioners of major States like Uttar Pradesh, Maharashtra and Karnataka have done upward revision in their sugar production estimates for the 2023-24 season to the tune of 5-10 per cent each,” ISMA said in a statement.

Concurring with these States’ estimates, ISMA aid sugar production in the current year could be higher than what was expected earlier. “Even after allowing additional sugar for the production of ethanol, closing sugar balance shall be sufficient to cater a couple of months into the next season,” it said.

Around 520 mills are in operation so far this season, compared with 515 mills a year ago. Sugar production in Maharashtra, the country’s leading producer, was down at 50.73 lt against 60.26 lt in the year-ago period. Similarly, production in Karnataka, the third largest producer, was down at 31.16 lt from 33.58 lt.

But, sugar output in Uttar Pradesh, the largest sugarcane producer, is reported to be higher at 45.73 lt until January 15 against 40.65 lt in the year-ago period.