ISMA Hails Ethanol Tender Restrictions to Protect Domestic Sugar Supplies, Flags Preferential Allocation for Dedicated Plants

New Delhi, Oct 21 (KNN) The Indian Sugar & Bio-Energy Manufacturers' Association (ISMA) has welcomed the exclusion of ethanol made from sugarcane juice, sugar syrup and B-heavy molasses from the latest procurement tender issued by state-run oil marketing companies (OMCs), saying the move will help safeguard domestic sugar supplies.

The tender, issued by Bharat Petroleum Corporation Ltd (BPCL) on behalf of OMCs on October 16, seeks around 11 billion litres of ethanol for the 2026-27 supply year, beginning November, to support the government's 20 per cent ethanol-blending target for petrol.

Under the tender, C-heavy molasses-based ethanol remains eligible, allowing sugar mills to continue supplying ethanol without diverting recoverable sugar from production.

Domestic Sugar Supply A Priority

In a statement on Monday, ISMA said the government's calibrated approach would help balance domestic sugar availability with ethanol supply, PTI reported.

It noted that domestic sugar consumption should remain the priority, particularly as emerging El Nino conditions and weather variability in key sugarcane-growing regions could affect crop yields and production.

However, the industry body raised concerns over preferential allocation given to dedicated ethanol plants holding long-term offtake agreements under the 2026-27 tender.

ISMA emphasised that extending this provision to subsequent supply years could disadvantage sugar mills and urged the government to review the allocation framework for future tenders.

The association said the current exclusion of sugarcane juice, sugar syrup and B-heavy molasses would help protect domestic sugar availability while allowing ethanol production through C-heavy molasses.

(KNN Bureau)