Increased Use of FCI Rice in Ethanol Production May Impact Maize Demand
20-Jan-2025 12:11 PM
Increased Use of FCI Rice in Ethanol Production May Impact Maize Demand
Oil marketing companies have floated tenders for producing 1.1 billion liters of ethanol using FCI rice.
Last week, FCI reduced the price of rice for distilleries to ₹22.50 per kg (down from the production cost of ₹39.75 per kg). A subsidy of ₹17.25 per kg will be provided.
The government allocated 2.4 million tons of rice for ethanol production.
The tenders aim to reduce the pressure on maize for ethanol production.
One ton of rice can produce 770 liters of ethanol. From the 2.4 million tons of rice, around 1.12-1.13 billion liters of ethanol is expected to be produced, with the subsidy cost reaching ₹4,140 crore.
Another government goal is to clear the surplus rice stock with FCI, as rice sales under OMSS have been minimal, leading to high stock levels.
As of January 1, the central pool had 61 million tons of rice stock (including unmilled paddy), compared to 51.65 million tons last year.
The rice priced at ₹22.50 per kg will not have any additional charges.
Various states have allocated 1.2 million tons of rice to corporations at ₹2,800 per quintal.
Under the "Bharat" brand, rice will be sold at ₹2,400 per quintal.