ISMA urges ethanol price revision amid rising sugarcane costs in India 

INDIA – The Indian Sugar and Bio-Energy Manufacturers Association (ISMA) has appealed to the Indian government to revise ethanol procurement prices, citing rising input costs driven by an increase in the fair and remunerative price (FRP) of sugarcane.  

In a formal request to the Commission for Agriculture Costs and Prices (CACP), ISMA highlighted the lack of revision in the prices of ethanol derived from sugarcane juice and B-heavy molasses since 2022. 

B-heavy molasses, a key byproduct in sugar manufacturing, is widely used in ethanol production.  

According to ISMA Director General Deepak Ballani, aligning ethanol procurement prices with the FRP of sugarcane and the minimum selling price (MSP) of sugar is critical, as sugarcane cost represents a significant share of production expenses in the sugar industry. 

The CACP, under the Ministry of Agriculture and Farmers’ Welfare, recommends the FRP for sugarcane, which is later approved by the Cabinet Committee on Economic Affairs (CCEA).  

Although ethanol derived from C-heavy molasses saw an increase in its administered ex-mill price to Rs 57.97 (US$0.68) per litre for the 2024-25 ethanol supply year (ESY), no similar revision was made for ethanol produced from sugarcane juice or B-heavy molasses, whose prices remain at Rs 65.61 (US$0.77) and Rs 60.73 (US$0.71) per litre, respectively. 

ISMA data shows ethanol from C-heavy molasses has seen consistent price increases over recent years—from Rs 49.41 (US$0.58) per litre in ESY 2022-23 to Rs 56.28 (US$0.66) in 2023-24 and Rs 57.97 (US$0.68) in 2024-25.  

Ethanol from alternative sources such as damaged foodgrains and maize has also seen upward revisions. Prices for ethanol from damaged foodgrains rose to Rs 64 (US$0.75) per litre, while those from maize jumped to Rs 71.86 (US$0.84) per litre.  

However, ethanol derived from surplus rice has remained fixed at Rs 58.50 (US$0.68) per litre since 2022-23. 

Ballani noted that despite a cumulative increase of Rs 350 (US$4.09) per tonne in sugarcane’s FRP—now Rs 3,400 (US$39.71) per tonne for 2024-25—ethanol prices for juice and B-heavy molasses have not been adjusted.  

He warned that unless procurement prices are revised, ethanol production will become economically unviable, disrupting industry operations and delaying payments to farmers. 

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