New Delhi: The Indian government may impose a 25% export duty on molasses, a key feedstock for ethanol production, to make it available for domestic distilleries, reported The Hindu BusinessLine.
The move comes amid a possible drop in sugar production next season, which could lower the availability of molasses.
The export duty is expected to help boost ethanol production and meet the government’s blending target. It would also help to protect the interests of sugar mills, which have invested in setting up distilleries.
Although discussions regarding the imposition of an export duty on molasses have been ongoing for some time, media reports say that the Finance Ministry is now recognizing its urgency and may soon issue the notification.
Notably, countries such as the Netherlands, the Philippines, Vietnam, South Korea, and Italy are the top destinations for Indian molasses, primarily used in cattle feed production.
BB Thombare, President of the West Indian Sugar Mills Association, stated, “It will be a welcome step if the government decides to restrict molasses exports. There is already apprehension of lower sugar production as sugarcane crops in Maharashtra and Karnataka have been affected due to a dry August. Sugar mills in Maharashtra that have invested in distilleries for ethanol production fear they may not be able to utilize 80 percent of their capacities.”
