Mumbai: Indiaa's Godavari Biorefineries plans to commission a 200 kilolitres-perday (KLPD) grain-based distillery in the June quarter, a move aimed at diversifying its feedstock and enabling the use of both sugarcane and corn depending on market prices.
"The new distillery will be integrated with our existing distillery. It will be a fungible facility that can change feedstock," Samir Somaiya, managing director of the company told Reuters.
The company operates a sugar mill in northern Karnataka, a key corn-growing region, he said. Indian sugar mills, long reliant on sugarcane for ethanol, are shifting to grain-based distilleries to run year-round and reduce exposure to swings in cane output.
Mills must pay a state-advised price to cane growers, which squeezes margins in surplus years when abundant supply depresses sugar prices while fixed cane payments remain in place.
There is a need to raise the minimum selling price of sugar to reflect higher cane costs and ensure mills can pay farmers the promised rates for their produce, said Somaiya.
Grain-based distilleries accounted for 69% of ethanol blended with petrol in the last marketing year, with sugarcane feedstock making up the remaining 31%, according to the All India Distillers' Association.
Corn prices are trading nearly a third below the government-set floor price due to a production surplus, making corn-based ethanol more profitable than sugarcanebased output, industry officials said.
Source: Economictimes.com
