India: Ethanol Increases To Protect Sugar Prices

Matt Hopkins Posted by Matt Hopkins|24 May 2010

MUMBAI, India — With India expecting a bountiful sugar crop next year, Indian Farm Minister Sharad Pawar has announced the country will increase ethanol production in order to protect mills from falling prices, according to Bloomberg Business Week. The move is not without precedent: Following a record harvest in 2007, India made sales of ethanol-blend gasoline mandatory. Ethanol prices could also increase, pending approval by the federal cabinet. India sugar mills have received $67 million in government loans over the last three years to increase ethanol production capacity to approximately 1.8 billion liters.

Sugar prices have already dropped 46% this year.
 

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