Ethanol producers may require 11.3 million tonnes of maize this year

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Distilleries producing ethanol from maize have received orders to supply 431 crore litres of ethanol for which as much as 11.3 million tonnes (mt) of the coarse cereal will be required. This raises a question how such a huge quantity will be available. However, industry sources said during the current season, 8 mt of maize will be required to supply 306 crore litres. It will not be an issue and there may a smooth transition next season.

Until September 30, ethanol supplied from maize (as feedstock) was 231.49 crore litres, which is 76 per cent of the allotted quantity for the ethanol supply year (ESY) 2023-24 that runs from November to October, industry sources said.

“ During the first two quarters (November-April) of the next ESY, distilleries will have less than 5 mt of maize requirement to supply 188 crore litres as committed by them to oil marketing companies (OMCs). Given that the kharif maize production was 22.25 mt in the 2023-24 kharif season out of a total area of 8.33 million hectares (mh), the output in current season may go up due to higher acreage, which will add to the overall availability of the grain,” said an industry official.

4.5% higher acreage

According to the Agriculture Ministry data, the kharif acreage of maize this year was 4.5 per cent higher at 8.85 mh as on September 27, against 8.47 mh year-ago.

However, an agriculture scientist said the acreage data could be misleading as there may have been some diversification from maize to paddy this year amid good rainfall. Unless there is a verification of the acreage data, it is premature to speculate on production, which gets updated 3-4 times a year. The scientist particularly referred to lower acreage of about half a lakh hectares in Karnataka, a major producer of kharif maize.

Indian distilleries produce approximately 380-390 litres of ethanol out of one tonne of maize and 450-460 litres of biofuel out of one tonne of rice. Since the availability of broken rice is not adequate and also its prices are not that profitable, most of the distillers prefer maize, putting pressure on other industrial users and poultry/cattle feed makers to source the grain cheaper.

Currently, maize is, on an average, selling at about ₹2,101/quintal, lower than its minimum support price (MSP) of ₹2,225 in agriculture market yards (mandis). However, the mandi prices are higher than MSP in Karnataka, Uttar Pradesh, Punjab, Haryana and Gujarat. Traders attributed prevailing rate of lower than MSP, particularly in Madhya Pradesh, to high moisture content in the grain as well as an expectation of a higher crop in the State.