How FCI rice is driving govt’s ethanol push

Food Corporation of India (FCI) supplied a record 4.4 million tonnes of surplus rice for ethanol production in Ethanol Supply Year (ESY) 2025-26 (up to June 30).

FCI rice supplied to ethanol distilleries increased from 3.2 million tonnes in ESY 2024-25 to 4.4 million tonnes in the current supply year.

A new procurement condition requires grain-based distilleries to source at least 40% of their grain-based ethanol offer from surplus FCI rice during the first three quarters of the supply year, extended to the fourth quarter by a July 3 circular.

Maize use for ethanol fell to 6.8 million tonnes from 13.1 million tonnes a year earlier, and damaged foodgrains and broken rice use dropped to 99,000 tonnes from 1.79 million tonnes.

The government says the diversion does not affect food security, citing procurement data, after supplies resumed in ESY 2024-25 following a 2023 suspension due to poor monsoon and food security concerns.