India’s target of achieving 20% ethanol blending may be difficult this season as sugar-based ethanol production is expected to decline sharply while maize availability remains a key constraint, according to Praful Vithalani, Chairman of the All India Sugar Trade Association (AISTA).
Vithalani said the latest ethanol procurement tender issued by oil marketing companies (OMCs) reflects the changing feedstock mix, with sugar expected to contribute only a small portion of total ethanol supplies. He said the outcome of the tender, expected by early November, will provide more clarity on ethanol availability for the 2026-27 season.
“The sugar share came down to 25% last season, and we will be left with around 2% only,” Vithalani said, adding that the government’s decision to avoid procurement from sugar syrup and B-heavy molasses has significantly reduced sugar’s role in ethanol production.
The government has floated a tender for 1,100 crore litres of ethanol for the 2026-27 supply year. Vithalani estimates that around 325 crore litres could come from rice and up to 100 crore litres from damaged grains, leaving maize to bridge the gap.
“As far as maize is concerned… 675 crore litres looks a challenge,” he said, noting that producing this quantity would require around 18 million tonne of maize, while maize prices have already risen by about 20-25% from last year.
Given these constraints, Vithalani believes the government’s ethanol blending target may be difficult to achieve. “I doubt on 20%. I can say it is a challenge,” he said, while adding that a second procurement tender later in the season could improve the outlook depending on maize and rice prices.
On sugar production, Vithalani said AISTA is likely to release its production estimate earlier than usual because of weather uncertainties linked to El Niño. He added that a survey conducted by his firm, Jayan Kesarja & Company, with domestic and international analysts points to sugar production of around 27 million tonne.
Despite concerns over output, Vithalani said sugar prices are likely to remain stable in the near term as the government has managed supplies through quota releases. He noted that adequate stocks are available to meet festive demand and that most sugar mills are expected to begin crushing by early November.
According to him, the government’s supply management measures should keep prices stable for the next two months, after which market expectations will depend on the final production estimates and crop outlook.
For the full interview, watch the accompanying video
Sugar-based ethanol may fall to 2% this season; 20% blending target looks difficult, says AISTA
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