From Maize to Momentum: India Powers Ahead with 20% Ethanol Blending Target

New Delhi: The sugar sector has achieved self-sufficiency in the last nine years, with farmers receiving more than 99.9% payment for the preceding season. Now, the introduction of Ethanol is set to support Maize farmers in maximizing their income, leading to growth and stability like that experienced by sugarcane farmers. This development has attracted investments worth thousands of crores, resulting in job creation, and generating a multiplier effect on the Indian economy.

Ethanol, an environmentally friendly fuel, has become a top priority, leading to a more than doubling of Ethanol blending in just two years. The target of 20% Ethanol blending has also been advanced from 2030 to 2025.

The Government of India, in partnership with the industry, has successfully achieved the target of 20% Ethanol blending in fuel. This is due to the timely planning, industry-friendly policies, and transparent approach adopted by the government. The collaborative efforts of the Central Government, States, Research Institutes, OMCs, and Distilleries played a crucial role in making this achievement a reality.

The Indian government has always put the interests of farmers at the forefront while aiming at bigger goals in a shorter time frame. As a result, the target of E20 was brought forward from 2030 to 2025, making India a world leader in clean fuel while promoting the interests of farmers. The synchronous efforts of various stakeholders have paved the way for a sustainable future for the nation.

The promotion of Maize cultivation in India requires a targeted and region-specific approach, highlighting the need for a collaboration between OMCs and the industry. Last year, the 10% blending target was achieved, and the country is moving in the right direction to achieve the 20% blending target. To achieve this target, there is a need for assured MSP procurement of Maize and an enabling ecosystem for the whole sector.

While molasses has traditionally been the primary source for distilleries in India, it is not sufficient to achieve the 20% blending target. As a result, the use of Ethanol from food-grains such as Maize, damaged food grains (DFG), and rice has been allowed, with the FCI providing these resources. To achieve the goal of blending 20% Ethanol with petrol by 2025, approximately 1016 crore liters of Ethanol will be needed, along with an extra 334 crore liters for other purposes. This will necessitate a production capacity of roughly 1700 crore liters of Ethanol, considering a plant operates at 80% efficiency.

According to estimates, around 165 LMT of food-grains will be required to achieve the 20% blending target for Ethanol production. While Maize is a popular feedstock worldwide due to its low water consumption and cost-effectiveness, its use for Ethanol production is not prominent in India. Currently, grain-based distilleries in the country produce Ethanol using Damaged Food Grains (DFG) such as broken rice or FCI rice. There is a negligible production of Ethanol from Maize by these distilleries. To ensure feedstock security and not burden any single feedstock's availability, multiple feedstocks can be utilized for Ethanol production. Additionally, using Maize as a feedstock for Ethanol production is more cost-effective and water efficient.

The production of Maize in the country is stable, but the low demand for Maize has resulted in farmers receiving inadequate payment for their produce. However, if Ethanol is produced from Maize, it would increase the demand for this crop, ultimately enabling farmers to get better prices for their produce.

Although Maize prices remain below the Minimum Support Price (MSP) leading to low cultivation area for the crop, the current export demand has driven up prices. Using Maize as a source of Ethanol production could provide more reliable demand and increased prices, ultimately leading to an increase in cultivation. This crop, which consumes less water than paddy, would thereby become a more lucrative option for farmers.

Distilleries can now be assured of a stable supply of feedstock in the market. This development is expected to create a mutually beneficial situation for both distillers and farmers. Moreover, it could also lead to significant contributions towards water and environmental conservation efforts. In line with sugarcane sector practices, distilleries are expected to collaborate with Maize farmers and procure their harvest at the Minimum Support Price (MSP) rate for Maize. In addition, the Petroleum Ministry has expressed a willingness to provide incentives for Ethanol production from Maize and establish a medium-term stable pricing policy.

The Indian Institute of Maize Research has announced that it will be working on developing better Maize varieties. Meanwhile, distilleries in the country are being urged to collaborate with the Cattle & Animal Feed Manufacturers’ Association (CLFMA) to establish quality standards for dried distiller's grains with solubles (DDGS) and tap into the vast opportunities available in the sector.

To guarantee increased profitability for farmers and distilleries, the industry can adopt an integrated strategy that includes incorporating Ethanol, DDGS, and other Maize by-products. This will also go a long way in meeting almost 50% of the country's Ethanol fuel needs through grain-based distilleries.

In alignment with the objective of Atamanirbhar Bharat for meeting the fuel energy needs of the country through Ethanol Blended with Petrol (EBP) Programme, a seminar was organized. The aim of the seminar was to further the interest of Maize farmers in the country and to bring all stakeholders of the Maize and Ethanol industry to one platform.

To achieve the target of 20% blending by the year 2025, need to discuss strategies and priorities for promoting Maize as the primary grain-based feedstock for Ethanol production.