Consideration to Limit Sugarcane Use for Ethanol Production

13-Aug-2026 08:39 PM

New Delhi. Concerns regarding the sugarcane crop have mounted due to deficient rainfall in major producing states like Maharashtra and Karnataka. Nationally, the area under sugarcane cultivation also lags behind last year's figures. Domestic sugar prices have surged towards record highs, even as industry stocks remain limited. In light of this, the Central Government may consider restricting the use of sugarcane derivatives—specifically sugarcane juice and B-heavy molasses—for ethanol production to maximize sugar output.

According to sources, if such a decision is taken, it could be announced before the commencement of the new marketing (crushing) season in October 2026. Such a move would necessitate an increased reliance on maize, rice, and damaged grains for ethanol production.

Sugar prices have witnessed a sharp rise in recent months and remain high, causing concern for the government and hardship for consumers. With demand and consumption expected to rise during the upcoming festive season, the upward trend in prices is likely to persist. Official sources indicate that the government would prefer to prioritize sugar production over ethanol manufacturing.