Due to decreased sugarcane availability, India, the second-largest producer of sugar in the world, has previously limited ethanol output this year. This was done to make sure the domestic market had an adequate supply of sugar.
New Policy Change
From the new ethanol supply year starting November 1, 2025, sugar mills and distilleries can produce ethanol from:
Sugarcane juice
Sugarcane syrup
All types of molasses
Importantly, there will be no limits on production volumes.
Government Protections
According to the Ministry of Consumer Affairs, Food & Public Distribution, sugar diversion to ethanol will be reviewed on a regular basis to make sure there is adequate sugar available for domestic consumption all year long.
The rationale behind the modification
Sugarcane production is anticipated to increase following two years in a row of favorable monsoon rainfall.
The availability of sugarcane for both sugar and ethanol has improved as a result of farmers expanding the cultivation area.
Industry Reaction
The action has been well received by sugar millers.
According to a Maharashtra miller, the government should also raise the cost of ethanol purchase so that mills may promptly pay farmers the government-fixed cane rates.
Impact on Sugar Mills
Major Indian sugar companies that have expanded ethanol capacity stand to benefit:
E.I.D.-Parry
Balrampur Chini Mills
Shree Renuka Sugars
Bajaj Hindusthan
Dwarikesh Sugar