India puts food before fuel as El Niño dents ethanol ambitions
Summary
India’s ethanol blending ambitions are faltering as weak monsoon rains and El Niño damage corn and sugarcane crops, forcing the government to put food security ahead of fuel production. The E20 program may slip below its 20% target as crop shortages push up feedstock prices and squeeze distilleries.
Key Points
- India may miss its 20% ethanol-blending target this supply year as crop shortages reduce feedstock availability.
- Weak monsoon rainfall and El Niño have pushed up corn, sugar and rice prices, worsening food inflation.
- The government has shifted priorities by limiting sugar-based ethanol procurement and cutting corn-ethanol purchase prices.
- Industry groups warn that lower blending will squeeze distilleries and could leave India more reliant on imported crude.
