Sugar and ethanol sector needs to focus on a 3-pronged strategy

Excerpts from Chopra’s address at a workshop organised by ISO in Delhi on June 25, 2024:

While India is privileged to be the chair of ISO this year, I would also like to mention that in September last year, India spearheaded the Global Biofuels Alliance to maximize efforts towards decarbonisation and enhance the use of ethanol, thereby bequeathing a cleaner world to future generations. My country will continue to invest its best efforts to meet the objectives set out and progressively advance towards a clean environment.

We are all aware that the world is witnessing the deleterious impacts of global warming in form of severe heatwaves and record temperatures on the Earth. It puts a huge responsibility on all ISO member countries as well as the sugar and ethanol industry to contribute to take the world towards net zero. The time has come when sustainability has to move beyond mere lip-service to become an intrinsic part of our operations, getting embedded in its DNA.

For this to happen, sugar and ethanol sector needs to primarily focus on a three-pronged strategy. First, to develop drought resistant varieties of sugarcane or varieties with low water consumption, secondly on water conservation in sugar production and last but not the least, taking the world towards biofuels from fossil fuels.

From this viewpoint, a lot of responsibility is cast on both India and Brazil — the top two producers of sugar with total contribution of about 50 per cent of global sugar. Incidentally, both are affected by the phenomenon of El Nino and La-Nina. So the global sugar supply cycle is either affected by lower production of sugar in Brazil due to La-Nina or in India due to El Nino.

Therefore, to ensure stability in global sugar supplies, it is critical for the sugar producers to collaborate in research and development in sugarcane so that better varieties, water efficient and suitable for local conditions with higher yield and sucrose content may be developed. Research and Development is one area, which needs concerted and synchronized efforts of major sugar producers in the world.

Similar requirement is for bio-fuels especially ethanol and sustainable aviation fuel (SAF). This would benefit the sector by increasing contribution to a greener planet as well as commercially control the excess supplies of sugar to world market making the sugar prices stable and reasonable for all stakeholders. In India, National Sugar Institute, Kanpur as well as Indian Institute of Technology (IIT), Kanpur are collaborating to set up a Centre of Excellence for Biofuels which will undertake research projects on biofuels. India would be keen to collaborate with other countries in this mission.

Another aspect which needs collaboration among ISO members is use of technology as well as data sharing. As of now, some industry players have started using modern technologies using AI/ML for crop estimation as well as harvest planning. But, these are isolated efforts with gains limited to the respective companies. ISO shall provide a platform to assist its member countries to use the technologies for their farmers, small players as well as the whole policy formulation. Interchange of data on mutually agreed terms will ensure smoothness and stability in policy making in all countries.

Integration of interest of sugarcane farmers as well as sugar consumers with the world sugar industry is one more focus area. At present, focus is more on industrial aspects and interest of sugar manufacturers and traders. Closer linkages between the farmers and industry and intensive extension services that ensure farmers’ welfare should be at the core. Mechanization of the sugarcane farming especially in countries like India, Thailand and other Asian Countries is of prime importance for better yield and recovery. Customization of machinery for smaller landholding is essential for this purpose and we need to work on this jointly with the industry. Besides, working on addressing health concerns of retail consumers, especially of children, is another aspect that we need to be mindful of.

Another area where we can work is on green financing for sugar and ethanol sector. As the industry is capital intensive and needs huge working capital to meet operational requirements, it is imperative to partner with financial institutions at global scale to receive green concessions and easier terms for financing in biofuels like ethanol and Compressed Bio Gas (CBG). This may make the whole sector more financially viable and strong.

In today’s flat world we face a complex scenario with complicated challenges. This demands that we work together with a joined-up approach, and ISO provides an ideal platform to strengthen cooperation, exchange of information and combined initiatives. It constitutes the umbrella under which all major stakeholders can gather and productively engage in tackling the tasks ahead. India is proud to foster a constructive space to generate such collaboration.