Guwahati: Sugar export in the current sugar season (2021-22) is 15 times that of the previous sugar season (2017-18). Indonesia, Afghanistan, Sri Lanka, Bangladesh, the United Arab Emirates, Malaysia, and African nations are the top importers.

In the sugar season 2020-21, 70 LMT were exported against a target of 60 LMT. In the last five years, around Rs 14,456 Cr has been granted to sugar mills to assist sugar export, and Rs. 2000 Cr has been issued as a carrying cost to maintain buffer stock. Since worldwide sugar prices are on the rise and stable, contracts for the export of around 90 LMT of sugar have been signed for the current sugar season 2021-22, with no announcement of any export subsidies; 75 LMT have been shipped as of May 18, 2012.

To find a long-term solution to the problem of excess sugar, the government is pushing sugar mills to shift extra sugarcane to ethanol production. With the goal of boosting the agricultural economy, reducing reliance on imported fossil fuels, saving foreign cash on crude oil import bills, and reducing air pollution, the government has set a target of 10% blending of fuel-grade ethanol with gasoline by 2022 and 20% blending by 2025.

To help the sugar industry and sugarcane farmers, the government has approved the manufacturing of ethanol from B-Heavy Molasses, sugarcane juice, sugar syrup, and sugar. To encourage mills to divert extra sugarcane to ethanol, the government has set a remunerative ex-mill price for ethanol generated from C-heavy and B-heavy molasses, as well as ethanol derived from sugarcane juice/ sugar/ sugar syrup, for the ethanol season.

Approximately 35 LMT of extra sugar is projected to be diverted to ethanol during the sugar season of 2021-22. It is hoped that by 2025, more than 60 LMT of extra sugar would be diverted to ethanol, solving the problem of excessive sugar stocks, improving mill liquidity, and assisting farmers in the timely payment of cane dues.

Since 2014, sugar mills and distilleries have produced about Rs. 64,000 crore in income from the sale of ethanol to OMCs, allowing farmers to be paid on schedule.

To increase the income of sugarcane farmers, the government has increased the FRP of sugarcane from time to time over the last eight years, and it has now been revised to Rs. 290/qtl for sugar season 2021-22 at 10% recovery (which translates to Rs. 275.50/qtl at 9.5 percent recovery), which is 31% higher than the FRP of sugar season 2013-14.

Mills acquired sugarcane worth Rs. 93,000 crore for the sugar season 2020-21. Sugar mills are anticipated to acquire sugarcane worth Rs. 1,10,000 crore during the sugar season 2021-22, which is an all-time high and the second biggest after paddy crop procurement at Minimum Support Price.

The government is also promoting distilleries to generate ethanol from maize and rice, which are both accessible with FCI, in order to enhance the output of fuel quality ethanol. The government has set a fair price for ethanol produced from maize and FCI rice.

To meet blending requirements, the government is pushing sugar mills and distilleries to expand their distillation capabilities, and the government is assisting businesses in obtaining bank loans with interest subventions of 6% or 50% of the interest paid by the banks, whichever is lower.

This will require an investment of around Rs. 41,000 crores.

As a result of these initiatives, ethanol distillation capacity in the country is expected to be quadrupled by 2025, ensuring the accomplishment of the 20% blending objective. It will handle the issue of excess sugar and ensure farmers' cane dues are paid on schedule.