India's agriculture ministry has flagged a surge in the amount of maize being diverted for ethanol production, citing concerns over a possibility of insufficient stock to meet domestic demand, a senior government official told Moneycontrol.
“We have expressed our concerns to the petroleum ministry over a significant diversion of maize for ethanol blending purpose. This is a serious issue,” the official said.
This official added that these concerns stem from India becoming import dependent for a grain that it typically exports.
In fact, India had become a net importer of maize briefly in September 2024 for the first time in decades due to higher diversion of the grain for ethanol blending.
The agriculture ministry’s concerns come at a time when the Indian government is looking at increasing the blending target of ethanol with petrol beyond 20 percent, primarily through the use of grain-based feedstock such as maize and broken rice.
According to India’s ethanol blending programme—which is spearheaded by Ministry of Petroleum and Natural Gas (MoPNG)—the government aims to achieve 20 percent ethanol blending with petrol by October 2025.
On account of the ethanol blending programme, higher volume of maize is being diverted towards ethanol production. For the 2023-24 supply year, India used 7.5 million tonnes of maize for ethanol production, compared to 0.8 million tonnes of the grain used in 2022-23. For the current supply year (2024-25), maize requirement for ethanol production is expected go beyond 12 million tonnes.
In India, Ethanol Supply Year (ESY) runs from October to November.
To reduce reliance on crude oil imports and increase the share of biofuels in the country’s energy basket, the Indian government wants to further increase the share of ethanol blending in petrol after the set target of 20 percent is met in 2025.
An inter-ministerial committee consisting of officials from the Ministry of Petroleum and Natural Gas, Ministry of Road Transport and Highways and Ministry of Agriculture and Farmers’ Welfare is working on a roadmap to decide a new target.
Commenting on the same, India’s oil minister Hardeep Singh Puri on July 17, said, “The committee’s work is quite advanced. I personally think it requires stakeholder consultation so that we move seamlessly. The issue isn’t about increasing ethanol blending; it is by how much.”
Moneycontrol had earlier reported that the government is looking at prioritising ethanol production from maize and broken grain, instead of sugarcane, to ensure food security while also ramping up ethanol production in the country.
Earlier this month, India’s agriculture minister Shivraj Singh Chouhan said that the country’s maize production that currently stands at 42.3 million tonnes, could be ramped up to 86 million tonnes by 2047. Chouhan added that the government is also working to increase the starch content in maize to improve the quality and efficiency of the crop.
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