ISMA seeks long-tem policy, formula for ethanol price to encourage investment in capacity expansion
Sugar industry body ISMA on Wednesday demanded that the government should come out with a long term policy and formula for ethanol pricing in order to encourage mills to expand capacity by around 400 crore litre which will require an estimated investment of Rs 17,500 crore. Briefing media about the demand-supply scenario of sugar for the 2023-24 marketing year starting next month, Indian Sugar Mills Association (ISMA) President Aditya Jhunjhunwala also demanded that the minimum selling price of sugar should be enhanced to Rs 38 per kg from the current Rs 31 per kg in view of an increase in production cost.
He said the ISMA will come out with a fresh sugar production estimate for the 2023-24 marketing year (October-September) during November after analysing the satellite image of sugarcane area across major producing states and then only would be able to assess whether there is any surplus for exports after meeting the domestic demand of sugar and ethanol.
«At present, the sugar industry has an installed capacity of 700 crore litre for ethanol production and we operate at 80 per cent capacity utilisation.
We need to increase our installed capacity to 1,000-1,100 crore litre. This will require an estimated investment of Rs 17,500 crore,» Jhunjhunwala told reporters here.
To facilitate this huge investment and a healthy return on it, he said, «we need to have a long term ethanol pricing policy.»
Jhunjhunwala said the government should devise some formula for fixation of ethanol price for blending with petrol.
He said the price of ethanol produced from sugarcane juice/syrup should be raised to Rs 69.85 per litre from about Rs 65 per litre now as the fair and remunerative price (FRP) of sugarcane has been increased by the
