Suggestion to Review Ethanol Prices Following Hike in Sugarcane FRP

06-May-2026 08:14 PM

New Delhi. The Commission for Agricultural Costs and Prices (CACP) has recommended to the Central Government that, in light of the increase in the Fair and Remunerative Price (FRP) for sugarcane, the prices of ethanol should also be raised proportionately. It is noteworthy that the government has fixed the FRP for sugarcane at ₹365 per quintal for the 2026-27 season—an increase of ₹10. This hike was also implemented based on the recommendations of the CACP.

According to the Commission, the production cost of ethanol derived from sugarcane will naturally rise as a result. During the 2025-26 marketing season, while there was a marginal increase in the selling price of ethanol produced from food grains, the prices of ethanol produced from other sources were kept unchanged.

Ethanol is produced from various sources, including sugarcane juice/syrup, B-heavy molasses, and C-heavy molasses, as well as damaged food grains, rice, maize, and substandard potatoes. Due to lower sugarcane yields, the use of sugarcane for ethanol production was permitted only in limited quantities during the 2025-26 marketing season. Furthermore, there is a need to raise the target for ethanol blending in petrol beyond the current level of 20 percent.