Excess stock, govt allows distillers to lift rice for producing ethanol

Tribune News Service

Chandigarh, August 30

In a major shift in its foodgrain policy, the Centre, which is grappling with excess rice stocks, has allowed private ethanol distilleries to participate in the e-auction of food-grains under its Open Market Sale Scheme (OMSS).

This is a huge shift in policy as the government had banned the use of rice for making ethanol last year. According to the Office Memorandum of the Ministry of Consumer Affairs, Food and Public Distribution, that was issued last evening, 23 lakh metric tonne rice has been allowed to be lifted by distilleries between August and October, during OMSS auctions.

Earlier this month, the government had also allowed the export of non-basmati white rice to Malaysia. A total of 2 lakh metric tonnes of rice have been allowed for export. Non-basmati exports were also restricted since July 2023.

Official sources said rice stocks presently being held by the government were around 540 lakh metric tonnes (lmt). As a result, the government has been struggling to manage for space to store the rice milled from paddy procured in 2023-24. With the next paddy procurement season set to begin in September, there is a major space crunch for storing the upcoming season’s rice.

In Punjab alone, 124 lakh metric tonnes of the total 125 lmt of space available for storing rice, is full. The Food Corporation of India is yet to take delivery for 2.5 lmt of rice from millers for the 2023-24 season. In the upcoming paddy season (2024-25), another 122 lmt of rice is expected to be delivered to FCI between November and March 2025, for which there is no space.

Huge shift in policy

• The move marks a huge shift in policy as the government had banned the use of rice for making ethanol last year
• However, now, 23 lakh metric tonnes of rice have been allowed to be lifted by distilleries between August and October