News Capsule: Ethanol Demand for Maize and Rice Likely to Increase
25-Aug-2026 01:36 PM
News Capsule: Ethanol Demand for Maize and Rice Likely to Increase
★ Amid high sugar prices and tighter government regulations, the use of sugar for ethanol production is likely to decline. This could increase the ethanol industry’s dependence on rice and maize, potentially providing support to maize prices in the coming months.
★ Sugar has previously accounted for around 33% of ethanol production, while maize contributes about 36-40% and rice around 25-27%.
★ Rice for ethanol production is mainly supplied through the Food Corporation of India (FCI), whereas maize is procured from the open market. Therefore, any increase in maize demand could have a direct impact on the open market.
★ If ethanol companies increase maize procurement, demand in the market could strengthen, providing support to maize prices in the coming months.
★ A shift toward lower ethanol production from sugar and higher production from maize and rice could emerge as an important demand-support factor for the maize market.
★ Going forward, the actual impact on maize prices will depend on ethanol companies’ procurement, the availability of rice from FCI, and the government’s upcoming policies.