On February 22, Food and Public Distribution Secretary Sanjeev Chopra announced that sugar mills would now have the opportunity to sell Potash Derived from Molasses (PDM) to fertilizer companies, presenting an additional revenue stream for them. He stated that the price for selling PDM to fertilizer companies has been set at Rs 4,263 per tonne with immediate effect, aiming for a production of 10-12 LMT potash in the next three years. Chopra highlighted that this initiative would provide another source of income for sugar mills equipped with distilleries.
Furthermore, the Cabinet Committee on Economic Affairs, on February 21, approved an increase in the Fair and Remunerative Price (FRP) of sugarcane to Rs 340 per quintal for the 2024-25 season, up from Rs 315 per quintal. This Rs 25-per-quintal hike in the FRP of sugarcane is notably higher than the previous year’s announcement.
Chopra mentioned that the government has introduced a nutrient-based subsidy (NBS) for the supply of granulated potash, known as PDM, which contains 14.5 percent potash content. Currently, India imports 100 percent of the potash required for fertilizers. The finalized price of PDM, agreed upon through discussions between sugar mills and fertilizer companies, is expected to result in long-term contracts and import substitution of potash-based fertilizers.
Regarding ethanol, Chopra revealed that the cabinet secretary recently reviewed ethanol blending with petrol, which currently stands at 11.5 percent. The target is to achieve a blending rate of 15 percent by the end of the year. However, there are no plans to increase the diversion of sugarcane juice or molasses for ethanol blending. Instead, research is being conducted on climate-resistant maize for ethanol production, with maize being promoted for this purpose.
Currently, the limit on the diversion of sugarcane juice and molasses for ethanol production is set at 17 lakh tonnes.
