Sugar mills in the country earned a revenue of around ₹35,000 crore by selling ethanol to the oil marketing companies in the country in the last four sugar seasons.

This was informed by Sadhvi Niranjan Jyoti, Union Minister of State for Consumer Affairs, Food and Public Distribution, to the Lok Sabha on Wednesday.

In a written reply, the minister said that around ₹35,000 crore of revenue has been generated by sugar mills / distilleries from sale of ethanol to OMCs in the past four sugar seasons of 2017-18, 2018-19, 2019-20 and 2020-21. This has helped in clearing cane price arrears of farmers.

The Government is encouraging sugar mills to export surplus sugar and to divert surplus sugarcane / sugar to ethanol with a view to liquidate surplus stock available with them, thereby improving liquidity of sugar mills enabling them to make timely payment of cane dues of farmers, she said.

ln the sugar season 2020-21, around 22 lakh tonnes (lt) of sugar has been diverted to ethanol.


To facilitate export of sugar thereby improving liquidity of sugar mills enabling them to clear cane price arrears of farmers, the Central government has extended assistance to sugar mills in sugar seasons 2015-16, 2017-18, 2018-19, 2019-20 and 2020-21.

Stating that an amount of approximately ₹12,900 crore has been released to various sugar mills on account of assistance to facilitate export of sugar since sugar season 2015-16, the Minister said around 16.5 lt, 6.2 lt, 38 lt, 59.60 lt and 70 lt have been exported in sugar seasons 2015-16, 2017- 18, 2018-19, 2019-20 and 202-21, respectively.

International sugar prices

Due to global deficit of sugar, prices of sugar in the international market are now stable due to which export of sugar is presently viable even without extending assistance. Contracts of about 30 lt for export of sugar have already been signed in current sugar season 2021-22.

To facilitate export surplus sugar from country, custom duties on export of sugar has been reduced to zero by the Central government, she said.

Against the estimated domestic consumption of 270 lt, sugar production in the current sugar season is estimated at 308 lt after discounting diversion of 35 lt of sugar to ethanol, the Minister said.

To a query on whether most of the cooperative sugar factories are running into losses in the country, she said the data regarding financial condition of any sugar factory (cooperative / private / public undertaking) is not maintained by the Department of Food and Public Distribution.

“However, with a view to improve the liquidity position of sugar mills, including cooperative sugar mills of the country, the Government has been taking various interventions from time to time,” she added.