Sugar Stocks Soar 12% As Govt Greenlights Ethanol Production From Sugarcane Juice; Check Latest Prices
Sugar stocks: The surge in sugar stocks follows the government's announcement on Thursday allowing sugar mills and distilleries to produce ethanol from sugarcane juice and syrup during the 2024-25 ESY
Sugar stocks surged on the bourses in early trade today, with gains of up to 12 per cent, following the government's decision to permit the use of sugarcane juice and syrup for ethanol production. This move marks a significant policy reversal, lifting a previous ban on the use of these raw materials for ethanol in the 2023-24 ethanol supply year (ESY).
Sugar Stock Prices
Leading the rally, Dalmia Bharat Sugar saw its shares soar by 11.98 per cent to Rs 495.05 on the National Stock Exchange (NSE) shortly after the opening bell. Other major players also posted strong gains, with Balrampur Chini Mills climbing 6.75 per cent to Rs 617.85 per share, and Dhampur Sugar Mills rising 6.87 per cent to Rs 223.51.
Shree Renuka Sugars and Bajaj Hindustan both jumped 8.39 per cent, trading at Rs 51.39 and Rs 44.16 per share, respectively, as of 9:27 am. Sakthi Sugars increased by 7.05 per cent to Rs 41.13 per share, while Dwarikesh Sugar advanced 5.75 per cent to Rs 77.82. Avadh Sugar & Energy also saw a strong performance, surging 6.59 per cent to Rs 753.45 apiece at 9:55 am.
The positive momentum extended to Praj Industries, a key supplier of ethanol plants, whose shares rallied 6.72 per cent to Rs 777.9 at 9:32 am on the NSE.
Govt Boosts Ethanol Production
The surge in sugar stocks follows the government's announcement on Thursday allowing sugar mills and distilleries to produce ethanol from sugarcane juice and syrup during the 2024-25 ESY. This decision comes after a ban in December 2023 that restricted the use of these raw materials for ethanol production to ensure sufficient sugar supply for domestic consumption and to stabilise prices.
"Sugar mills and distilleries are allowed to produce ethanol from sugarcane juice/sugar syrup, B-Heavy molasses, as well as C-Heavy molasses for ESY 2024-25 as per the agreement/allocation with OMCs (oil marketing companies)," the Food Ministry said.
The Food Ministry, along with the Petroleum and Natural Gas Ministry, will regularly review the diversion of sugar for ethanol production to ensure a steady supply of sugar for domestic consumption.
According to official data, ethanol blending in India reached 13.3 per cent by July of the current season, up from 12.6 per cent in the 2022-23 season. The country’s total ethanol production capacity currently stands at 1,589 crore litres, with OMCs purchasing 505 crore litres for blending during the 2023-24 season.
India, the world's second-largest sugar producer after Brazil, aims to achieve a 20 per cent ethanol blending target by 2025-26, further strengthening its position in the global market.
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