The National Federation of Cooperative Sugar Factories (NFCSF) today convened a high-level brainstorming session in Pune to deliberate on strategies for boosting ethanol production within the cooperative sugar sector. Chaired by NFCSF President Harshvardhan Patil, the meeting gathered key stakeholders and experts from across India.
Stakeholders and Participants
The session was attended by prominent figures, including Managing Directors of cooperative sugar factories and State Sugar Federations, NFCSF officials, and representatives from key government bodies. Participants included D.K. Verma, Director of the Union Ministry of Cooperation, Girraj Agnihotri, Director of the National Cooperative Development Corporation (NCDC), Dr. Kunal Khemnar, Sugar Commissioner of Maharashtra and other senior officials.
Pathway to Economic Self-Reliance
Union Minister of Cooperation, Shri Amit Shah, has emphasized the importance of economic self-reliance for the cooperative sugar sector. He proposed that Cooperative Sugar Mills (CSMs) actively participate in the 20% ethanol blending program throughout the year by utilizing maize as an alternative feedstock during the off-season for sugarcane. Following this directive, the NFCSF embarked on a mission-driven initiative to consult with CSMs and present their findings to the Union government.
Financial Assistance and Support
In response to the NFCSF’s advocacy and recommendations, significant financial measures have been introduced to support ethanol production:
- Interest Subvention: Term loans for ethanol projects will benefit from reduced interest rates.
- Favorable Debt-Equity Ratio: The NCDC has agreed to finance these projects with a highly favorable debt-to-equity ratio of 90:10, further lowering financial burdens on cooperative mills.
Transitioning to Multi-Feed Distilleries
The discussions focused on leveraging these financial incentives to upgrade existing distilleries into multi-feed facilities. This transformation would enable cooperative sugar mills to utilize food grains, particularly maize, as additional feedstock. By doing so, mills can operate year-round, enhance ethanol output, and improve financial sustainability.
Currently, only 63 of the 200 cooperative sugar factories in India have distilleries, contributing just 13% to the nation’s ethanol supply. Limited cane-based raw materials have constrained their production capacity. However, utilizing maize, a low-water-consuming crop grown in two seasons annually, offers a sustainable solution.
Benefits of Maize-Based Ethanol Production
Maize has emerged as a pivotal crop in this strategy. With its low water requirements and increased minimum support price, maize cultivation aligns well with the cooperative sugar sector’s goals. By transitioning to multi-feed distilleries, cooperative sugar factories can sustain ethanol production throughout the year, generating additional revenue streams and ensuring long-term viability.
Support from Oil Marketing Companies
Oil marketing companies have expressed readiness to enter into long-term agreements with cooperative mills for ethanol procurement. Additionally, directives have been issued to prioritize purchasing ethanol from cooperative distilleries, further strengthening the sector’s position in the national ethanol supply chain.
A Collaborative Mission The NFCSF, in partnership with the Union Ministries of Cooperation, Food, and Petroleum, is working in mission mode to drive this transformative initiative. The Pune meeting laid out a clear roadmap for cooperative sugar factories to capitalize on emerging opportunities, expand ethanol production capabilities, and contribute significantly to the nation’s energy independence goals.
