AIDA seeks higher maize, FCI rice ethanol prices, calls for balanced feedstock policy
The All India Distillers’ Association has urged India to revise maize and surplus rice ethanol procurement prices, citing rising production costs and shrinking margins. It opposed reducing maize ethanol incentives to ₹2.79 per litre and sought higher FCI rice-based ethanol rates and greater feedstock flexibility.
The All India Distillers’ Association (AIDA) has urged the government to revise procurement prices and incentives for ethanol made from maize and surplus rice saying current rates are putting pressure on the viability of grain-based distilleries, reported Business Today.
In its response to the Ethanol Supply Year (ESY) 2026-27 tender, the association called for a balanced policy framework covering both grain- and sugarcane-based feedstocks. It sought a review of the reduction in the maize ethanol incentive from Rs 5.79 to Rs 2.79 per litre, which takes the effective procurement price to Rs 68.86 per litre.
AIDA also called for an increase in the procurement price of ethanol made from surplus rice supplied by the Food Corporation of India (FCI), currently fixed at Rs 60.32 per litre. It said rising raw material, energy, chemical, processing and logistics costs were leaving distillers with limited margins.
The association said procurement prices and incentives should account for the different cost structures of each feedstock, while avoiding an undue advantage to any one source. It also sought greater flexibility for sugar mills and distilleries to use sugarcane juice, sugar syrup and B-Heavy molasses, subject to policy safeguards and domestic sugar requirements.
AIDA president Vijendra Singh said remunerative prices, appropriate incentives and operational flexibility across grain- and sugarcane-based feedstocks were necessary to sustain investment and ensure reliable ethanol supplies.
Vice president Kushal Mittal said policy incentives should not make one feedstock disproportionately attractive at the expense of others. He stressed that predictable policies and commercially viable prices would help the industry contribute to India’s 20% ethanol blending target.
AIDA deputy director general Bharati Balaji also sought higher prices for FCI rice-based ethanol, citing the rising costs faced by distilleries.
The association said diversifying feedstocks was important to manage uncertainties in agricultural output, raw material prices and regional availability, particularly amid the potential impact of El Nino on monsoon patterns.
AIDA said it would continue discussions with the Ministry of Petroleum and Natural Gas, the Department of Food and Public Distribution, oil marketing companies and other stakeholders on policy changes to support the ethanol blending programme.
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Source : ChiniMandi
