The Indian Sugar & Bio-energy Manufacturers Association (ISMA) is expected to hold a key meeting on Wednesday, March 12, to discuss ethanol pricing and policy matters for the upcoming marketing season, according to sources, states Zee Business.
The meeting is set to focus on a potential increase in ethanol prices and the implementation of a government-backed scheme to support sugar mills.
In January, ISMA urged the central government to raise ethanol prices, particularly for ethanol derived from sugarcane and B-Heavy molasses—a byproduct of sugar production used in ethanol manufacturing. The industry body argued that a price hike would help sustain the domestic sugar sector and ensure timely payments to sugarcane farmers.
According to sources, the upcoming meeting will likely include discussions on revising ethanol prices and evaluating a recently introduced scheme that allows cooperative sugar mills to secure subsidized loans for converting their sugarcane-based ethanol plants into multi-feedstock units.
The industry body is also seeking greater clarity from the government on sugar policy regulations.
Last week, the Department of Food and Public Distribution announced a modified ethanol interest subvention scheme. Under this initiative, cooperative sugar mills can receive financial assistance to upgrade their ethanol production facilities, enabling them to use alternative feedstocks such as maize and damaged food grains (DFG).
As part of this scheme, the central government will provide interest subvention at a rate of 6 percent per annum or cover 50 percent of the interest charged by banks or financial institutions—whichever is lower—for loans taken by sugar mills. The government will bear this cost for five years, including a one-year moratorium period.
Sugar mills typically operate for only four to five months each year during the sugarcane crushing season, limiting their overall efficiency and productivity. The government aims to address this challenge by allowing cooperative sugar mills to diversify their ethanol production under the revised scheme, according to an official statement issued on March 7.
Meanwhile, the central government continues to implement its Ethanol Blended with Petrol (EBP) Programme, which aims to achieve a 20 percent ethanol blend with petrol nationwide by 2025.
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