The Union Government has defended the ethanol blending programme saying it has helped stabilise sugar prices, reduced concern on cane arrear payment and helped cut import of crude oil, after some experts criticised the policy saying the Centre is promoting the water guzzling crop.

“In last 12 years, hardly there is any increase in area of sugarcane, whereas its production has gone up substantially thanks to scientists of Indian Council of Agricultural Research (ICAR) for developing better varieties,” said a senior Food Ministry official. He said there is no crisis now in the sugar sector as the government has been able to manage the excess production generated from same level of acreage.

He said the first priority would remain meeting domestic sugar demand which is estimated around 275 lakh tonnes (lt), after which ethanol will be given prominence over export. “There is no urgency to allow export and if there would be more availability of sugarcane, the government might think about it,” he said.

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Arrears down

According to Agriculture Ministry data, the sugarcane acreage has increased to 51.75 lakh hecatres (lh) in 2021-22 from 50.38 lh in 2011-12, up by 2.7 per cent, whereas the sugarcane production surged to 4,394.25 lakh tonnes (lt) from 3,610.36 lt (up 22 per cent) in these 11 years. In case of sugar production, too, the increase was over 36 per cent to 357.6 lt from 263.42 lt between 2011-12 and 2021-22.

The official also pointed out that cane arrears, which used to be 20-30 per cent (of total dues for the season) after 8-9 months in the sugar season, has come down substantially as realisation from ethanol has made sugar mills clear cane payment in less time than what used to be earlier.

With the promotion of micro irrigation and also rise in awareness, the water consumption in sugarcane has been reducing what it was 10 years ago, Atul Chaturvedi, exceutive chairman of Shree Renuka Sugars, said. He also recently suggested the government ethanol policy be tweaked in favour of sugarcane vis-a-vis grains so that capacity is increased by sugar mills.

The Food Ministry expects about 55 lt in terms of sugar diversion towards ethanol next year against about 40 lt in current season. The diversion estimate is based on how much quantity of sugar could have been produced from the same quantity of sugarcane that gets diverted towards ethanol.

Until June 23, the OMCs have achieved 11.77 per cent blending since ethanol season started from December 2022, whereas for the whole ethanol year the blending target is 12 per cent. The government has shortened the current ethanol season to 11 months as from 2023-24 season, it has been changed to run from November to October.

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