Ban on sugar for ethanol production; Center Files Caveats in High Courts
An official said that the central government had filed a caveat in the High Courts of Bombay and Karnataka, requesting to be heard before the courts issue any stay orders on the restrictions imposed on the use of sugar for ethanol production.
Several sugar companies have petitioned various courts for a stay on the Center’s December 7 order prohibiting mills from producing ethanol from sugarcane juice during the 2023–24 season.
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Without a caveat, the courts may issue a stay order without hearing from the government, according to the official cited above. The Centre issued the ban to keep rising sugar prices in the domestic market under control, despite export restrictions due to lower sugarcane yields in the main producer states of Maharashtra and Karnataka.
Sugar prices in northern India reached ₹40 by the end of the sugar season 2022–23 (October–September).
To allay industry concerns, the government later allowed the diversion of 1.7 million tonnes of sugar for ethanol production during the 2023–24 marketing year, which began on October 1, 2023.
The industry body, the Indian Sugar Mills Association (ISMA), has renamed itself the Indian Sugar and Bio-energy Manufacturers Association. The industry body stated that the “sudden ban” on the use of cane juice for ethanol would harm the capacity utilization of mills, putting their ₹15,000-crore investment in green fuel plants at risk. In July, the Food Corporation of India (FCI) stopped supplying distilleries with rice for ethanol production, leaving distilleries with fewer raw material options.
India’s Ethanol Blending Programme aims to achieve a 20% ethanol blend in petrol by 2025, producing ethanol from both sugar and grain. Also Read | Delay in signing purchase agreements by OMCs, ethanol projects impeding
Lower yields resulted from insufficient rainfall in key sugarcane-producing states such as Maharashtra and Karnataka, which received 3% and 18% less rainfall than normal during the monsoon season, respectively.
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