India’s Ethanol Program Surpasses 800 Crore Liters, Grain-Based Sources Dominate Supply Landscape
New Delhi, [Date of Publication]: India’s ambitious ethanol blending program has achieved a significant milestone, with cumulative ethanol supplies crossing 800 crore liters during the Ethanol Supply Year (ESY) 2025-26. However, recent data from the All India Distillers’ Association (AIDA) reveals a notable shift in the supply chain, indicating a robust surge in
While the program celebrates this volumetric achievement, the focus is now turning towards ensuring robust demand to match the rapidly expanding production capacity.
Grain-Based Ethanol Gains Prominence as Monthly Supplies Moderate
According to AIDA, India received 93 crore liters of ethanol in July, pushing the cumulative figure for ESY 2025-26 past the 800-crore-liter mark. This represents a slight moderation compared to June’s supply of 103 crore liters. Despite this marginal dip in monthly volume, the proportional contribution of grain-based ethanol has significantly increased.
In July, grain-based feedstocks supplied an impressive 71 crore liters, constituting approximately 76% of the total monthly ethanol supply. This marks a notable rise from June, where grain-based sources contributed 75 crore liters, or roughly 73% of the total 103 crore liters. This upward trend underscores a strategic diversification and increased reliance on agricultural surplus for biofuel production.
Within the grain-based segment, maize and surplus Food Corporation of India (FCI) grains have emerged as pivotal contributors, each supplying 30 crore liters in July. Together, these two feedstocks accounted for nearly 85% of all grain-based ethanol supplied during the month. An additional 11 crore liters were derived from damaged food grains, further highlighting the program’s ability to utilize diverse agricultural resources.
Bharati Balaji, Deputy Director General of AIDA, lauded the achievement, stating, "The 800-crore-liter milestone reflects the scale reached by the domestic ethanol industry. What is equally significant is the movement in the monthly supply mix. Grain-based ethanol increased its share from around 73% in June to 76% in July, with maize and surplus FCI grains each contributing 30 crore liters."
Sugarcane-Based Supplies Experience a Downturn
Conversely, sugarcane-based feedstocks witnessed a decline in their contribution to the monthly supply. In July, these sources accounted for 22 crore liters, a drop from 28 crore liters in June. Consequently, their share of total monthly supplies fell from approximately 27% to around 24%.
Within the sugarcane category, B-Heavy Molasses remained the primary contributor with 17 crore liters, followed by Sugarcane Juice at 4 crore liters and C-Heavy Molasses at 1 crore liter. The July figures thus clearly illustrate a supply mix leaning heavily towards grain-based feedstocks, even as overall monthly volumes saw a slight reduction.
The Road Ahead: Ensuring Demand for Expanding Production Capacity
With India’s ethanol production capacity rapidly expanding, the industry is now shifting its focus from supply to demand. AIDA emphasizes that the domestic industry has demonstrated its capability to ramp up production through a multi-feedstock approach and a growing manufacturing base. The paramount challenge now lies in generating sufficient demand to effectively utilize this enhanced capacity.
"The supply side has demonstrated its ability to respond through multiple feedstocks and a growing production base. The next step is to create sufficient demand for this capacity," Balaji articulated. She further suggested several avenues for increasing utilization, including higher ethanol blending rates, the widespread adoption of Flex-Fuel Vehicles (FFVs), and exploring broader industrial applications for ethanol.
Balaji underscored the critical need for a stable and predictable policy framework to sustain investment and support the agricultural sector. "The industry has created a much stronger production base, and the priority now should be to ensure that this capacity is utilized efficiently. A clear and predictable framework for expanding ethanol applications will be critical to sustaining investments, supporting the agricultural value chain and advancing India’s transition towards cleaner domestic fuels," she stated.
As India continues its pursuit of clean mobility and renewable fuel objectives, creating additional avenues for ethanol use will be instrumental in maximizing the potential of its burgeoning domestic production capacity. The successful integration of ethanol into the nation’s energy matrix will hinge on a collaborative effort between policymakers, industry stakeholders, and consumers to foster a robust demand ecosystem.
