Cheaper crude, dearer ethanol: India’s maize bind
Maize is now the source of close to half of all the ethanol that India blends into petrol, up from almost nothing three years ago
India’s shift from sugarcane-based ethanol to maize-based blends is driven by policy and market factors. The government aims to reduce dependence on imported crude oil by blending ethanol into petrol, despite high costs. Maize, being a kharif crop and rainfed, is faster-growing than sugarcane but has lower yield per hectare. India exported maize worth $764 million in 2022-23 but became a net importer by 2024-25.
With maize prices rising, the government's fixed price for ethanol production has left distilleries struggling to compete with poultry and animal-feed industries. Sugarcane-based ethanol faces limited demand due to the absence of flex-fuel vehicles, and ethanol's lower energy content means vehicles don't receive the same fuel economy.
Brazil's ethanol policy, in contrast, allows higher ethanol blends and more consumer choice, while India's policy has resulted in higher costs for both farmers and consumers.
Written by urgent.news from The Hindu's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
