Food Secretary thumbs down resuming sale of subsidised rice for ethanol

India’s Food Secretary Sanjeev Chopra has stated that the Central Government does not currently plan to reintroduce the sale of subsidized rice to grain-based distilleries for ethanol production.

As per reports, Sanjeev Chopra has clarified that since July of the previous year, there hasn’t been any diversion of rice for ethanol production and that there are no immediate plans to change this policy.

Chopra responded to queries about the potential restart of subsidized rice sales for ethanol production, particularly considering the expected decline in sugar production for the 2024-25 season. He outlined several reasons for halting rice sales for ethanol production, including uncertainties in domestic output, high retail prices, and economic feasibility concerns.

His comments have come at a time when the debate is raging whether the grains should be used for food security or for biofuels production.

Addressing the impact on investments in grain-based distilleries, Chopra stressed that the current policy is subject to review and mentioned the promotion of maize for ethanol production. He noted a significant increase in ethanol production from maize, with around 50 crore litres supplied during the 2024-25 supply year.

He urged industries with grain-based distilleries to prioritize maize for ethanol production. While acknowledging the Government’s awareness of and concern about the anticipated decrease in sugar output next season, he cautioned against prematurely forecasting sugar production figures for the 2024-25 season, expecting reliable data by August.

Highlighting lower reservoir levels in Maharashtra and Karnataka compared to previous years, Chopra emphasized the Government’s cautious approach to ensuring higher sugar closing stocks for the current season. He affirmed that these stocks could be used not only for domestic consumption but also for diversion to ethanol production if needed.

Moreover, Chopra pointed out the Government’s decision to increase the Fair and Remunerative Price (FRP) of sugarcane for the next season, signaling a positive message to farmers to boost cultivation. The sugarcane FRP has been raised to Rs 340 per quintal for the 2024-25 season, up from Rs 315 per quintal in the current season.