Govt allows sale of FCI rice for ethanol production

Tribune News Service

Chandigarh, August 30

In a major shift in its foodgrain policy--the Union Government--grappling with excess rice stocks, has allowed the private ethanol distillers to participate in the e-auction of the food grains under Open Market Sale scheme.

This is seen as a big change in the policy as the government had banned the use of rice for making ethanol last year.

According to the office memorandum of Union Ministry of Consumer Affairs, Food and Public Distribution, issued last evening, 23 lakh metric tonnes of rice has been allowed to be lifted by the distilleries between August to October, during the OMSS auctions.

The government has also allowed export of non basmati white rice to Malaysia.

A total of 2 lakh metric tonnes of rice had been allowed for export. Non-basmati rice exports were restricted since July 2023.

Official sources say that the rice stocks presently being held by the government are 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 unable to take delivery for another 2.5 lmt of rice from millers. In the upcoming paddy season, another 122 lmt of rice is expected to be delivered to FCI between November to March 2025, for which there is no space.