India becomes a major maize importer as ethanol demand rises
India, previously a major maize exporter, has turned into a significant importer due to the government’s focus on ethanol production from maize. Exports are expected to drop drastically to 4.5 lakh tonnes, while maize imports may hit 10 lakh tonnes. This shift has raised concerns in the poultry and starch industries, which face shortages as maize is diverted for ethanol production.
India, once the major exporter of maize, has now turned into a big importer due to the Government’s thrust on ethanol production from maize, reports Agrowan.
Normally, India exports 20 to 40 lakh tonnes of maize in a year but this year, the exports are likely to come down to just 4.5 lakh tonnes. Countries like Vietnam, Bangladesh, Nepal, and Malaysia that import maize from India have started searching for other suppliers due to rising domestic maize prices.
In the same period, the country is likely to witness a record import of 10 lakh tonnes of maize, mainly from Myanmar and Ukraine. The shift follows the government’s decision to raise the ethanol content in fuel from the current 13% to 20% to cut carbon emissions, which has called for an increase in ethanol production by as much as four times.
The government this year reduced ethanol produced from sugarcane over concerns of less sugar production due to drought. This bumped up the demand for maize. About 35 lakh tonnes of maize were used to manufacture ethanol this year against less than a fourth of this quantity last year. However, even after removing the restrictions on the use of sugarcane for ethanol production, the top priority of the government remains enhancing the domestic availability of sugar, leaving no scope for ethanol production from sugarcane. This has kept demand for maize high and front page of both domestic and international prices of the commodity.
These developments have set alarm bells ringing in India’s poultry and starch industries that require the entire 360 lakh tonnes of maize produced in the country. These industries are in short supply as more maize is diverted for ethanol production. They have sought government intervention to abolish import duties on maize and the ban on the import of GM varieties of maize. Presently, imports of maize attract a duty of 50 per cent, though the government had recently brought it down to 15 per cent and allowed import of 5 lakh tonnes.
For now, farmers benefit from the changes as maize prices remain stable despite imports. Many farmers saw the prospect of better returns and increased maize cultivation saw a foreseen rise of 7% plantings this year.
At the same time, dependence solely on imports is not a good solution for future requirements, as experts explain. A government policy assuring returns to farmers for three to five years can bring about a manifold increase in maize production within the country.
This is also because in Maharashtra, soybean and cotton, the two major crops grown during the kharif season, have been giving poor returns to the farmers in recent years. Maize may emerge as a substitute for one of these crops. A long-term policy by the government could favour farmers’ interests as well as ethanol, poultry, and starch industries.
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Source Link : https://www.chinimandi.com/india-becomes-a-major-maize-importer-as-ethanol-demand-rises/
