Overview
- The joint tender issued by state-run oil marketing companies is dated October 16 and seeks about 1,100 crore litres for the supply year from November 1, 2026 to October 31, 2027.
- The procurement explicitly excludes ethanol made from sugarcane juice, sugar, sugar syrup and B-heavy molasses while allowing C-heavy molasses, maize, damaged foodgrains and surplus FCI rice as eligible feedstocks.
- The tender cuts the maize incentive from ₹5.79 per litre to ₹2.79 per litre and lowers the maize procurement price to ₹68.86 per litre, reducing returns for corn-based suppliers.
- Suppliers must deliver ethanol from their own registered or approved distilleries and first-quarter allocations remain subject to pending court proceedings over OMC allocation methodology.
- Markets reacted quickly with listed sugar producers’ shares falling about 5–7 percent as mills face lost ethanol sales and will need to repurpose distillery capacity or rely on permitted raw materials during the festive season.