The government has approved a standard operating procedure (SOP) that facilitates agreements between agencies such as Nafed and NCCF with distillers, ensuring a guaranteed supply of maize at ₹2,291 per quintal for ethanol manufacturing, reported Financial Express.
Simultaneously, these agencies will procure maize from farmers at a Minimum Support Price (MSP) of ₹2,090 per quintal for the kharif season of 2023-24.
An official highlighted that the primary objective of the scheme is to secure the MSP for maize farmers, while distilleries receive assurance of a consistent supply of feedstock, thereby mitigating the risks associated with price volatility.
The official further indicated that the procurement of maize will commence during the upcoming Rabi season. Estimates suggest an annual requirement of approximately 3.5 to 4 million tonnes of maize for ethanol production. This strategic move aligns with the government’s broader initiatives to enhance ethanol blending with petrol. In the Ethanol Supply Year (ESY) 2022-23, the ethanol blending rate stood at around 12%, with a target set to increase it to 15% in ESY 2023-24.
