The government has approved the standard operating procedure (SOP) through which agencies such Nafed and NCCF will enter into pacts with distillers for assured supply of maize at `2,291/quintal for ethanol manufacturing, while the agencies will buy maize from the farmers at an MSP of `2090/quintal for kharif season (2023-24).
“The scheme aims to ensure the guaranteed MSP to maize farmers, while distilleries get assurance of uninterrupted supply of the feedstock, de-risking price volatility,” an official said.
The official said that maize procurement will be initiated in the forthcoming rabi season, while according to estimates, around 3.5 – 4 million tonne of maize is annually required for ethanol.
The move is part of the government’s efforts to increase blending of ethanol with petrol, which was around 12% in Ethanol Supply Year (ESY) 2022-23 and the target is to reach 15% in ESY 2023-24.