NAFED, NCCF can sell ‘maize’ to ethanol makers at base rate

The central government has granted permission to cooperatives Nafed and NCCF to sell maize to distilleries at a base price of Rs 2,291 per quintal this year. The objective is to ensure a steady maize supply for ethanol producers.

According to reports, National Agricultural Cooperative Marketing Federation of India Ltd.(NAFED)  and the National Cooperative Consumers’ Federation of India (NCCF) will purchase maize at a minimum support price of Rs 2,090 per quintal in the 2023-24 crop year. The same will be provided by them to the distilleries at an agreed rate of Rs 2,291 per quintal.

This initiative aims to guarantee uninterrupted access to maize, a key feedstock for ethanol production, for distilleries. The country’s maize production for the 2023-24 crop year (July-June) is estimated at 22.48 million tonnes, according to the agriculture ministry’s initial advance estimate.

The government is actively promoting maize usage as an alternative to sugar to bolster ethanol production and maintain an ample supply of sweetener in the market. In December of the previous year, the government instructed sugar mills not to utilize cane juice for ethanol production due to an anticipated decline in sugar production in the 2023-24 marketing year (October-September).

Concurrently, oil marketing companies have increased the procurement price of maize-derived ethanol by Rs 5.79 per litre to incentivize its production and blending with petrol.

India has already phased in 20% blended fuel in April 2023, with widespread availability expected in the coming days. The government has set ambitious targets, aiming for 20% ethanol-blended petrol by 2024-25 and 30% by 2029-30, advancing the E20 fuel target from 2030 to 2025.