From The Economic Times · Reuters · · 1m
Drought Threatens India's Ethanol Target
India's ethanol blending target drops as drought prioritizes food security.
In brief
India's ethanol blending target drops as drought prioritizes food security. India's ethanol blending rate may fall to 15% due to drought impacting corn and sugarcane crops, shifting focus to food security. Originally reported by The Economic Times.
Monsoon Drought Impacts
India faces lowest monsoon rainfall in over a decade, threatening corn and sugarcane crops.
Ethanol Blending Target at Risk
Ethanol in Indian petrol may fall below 20% target as food security takes priority.
Economic Impact of Drought
Corn and sugar prices surged 40% to record highs, with rice climbing 20% amid drought.
Industry Expert Warning
G.K. Sood, KN Agri Resources chairman, states food must take priority over fuel in drought years.
“India is the world's most populous country, so food has to take priority over fuel, more so in a drought year”
Blending Rate Decline Expected
Ethanol blending rate may drop to 15% from 20% due to corn shortages and high food prices.
Government Response
Government cut corn-based ethanol purchase price to 68.86 rupees per litre to curb distillery margins.
Food Inflation Concerns
Retail food inflation accelerated to 7.74% in September, driven by drought-related crop shortages.
The one thing
India's ethanol blending rate may fall to 15% due to drought impacting corn and sugarcane crops, shifting focus to food security.
