Oil firms blamed for ethanol stock pile-up
Ethanol distilleries in the country are faced with high and rising stock of the biofuel amid a demand-supply imbalance that, they allege, is because state-run oil marketing companies (OMCs) are not buying sufficient quantities.
Two executives at OMCs, however, said they are buying as much ethanol as is required to meet the target of blending 15% ethanol in petrol. «The stock at ethanol producers is rising as OMCs are unable to lift enough quantity,» said an ethanol industry executive who didn't want to be identified. «This could be due to limited storage capacity at OMCs' depots,» the person added. State-run oil marketing companies Indian Oil, Hindustan Petroleum, and Bharat Petroleum purchase ethanol from diverse producers to blend it with petrol at their depots before supplying the fuel to pumps.
These companies did not respond to ET's request for comment until press time Sunday.
But two OMC executives, who didn't want to be identified, said their firms were on course to meet the blending target of 15% for the current year. They said the current trouble in the ethanol industry was an outcome of rapid enhancement in biofuel production capacity in the country. Ethanol company executives confirmed massive capacity buildup in the industry. «A lot of ethanol production capacity has been added in recent years, but OMCs need a limited quantity to meet their 15% blending target for the current year,» an ethanol industry executive said. «Next year, when they have a higher blending target of 20%, OMCs may procure more,
