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Govt bars OMCs from diverting sugar for ethanol

2026-10-18 · 1 source · Economic Times Energy

In short

The government has told oil marketing companies not to use sugar to make ethanol. The reports say this comes as sugar output may be lower and prices are high, while OMCs are seeking 1,100 crore litres of ethanol from other feedstocks.

This matters for sugar supply, ethanol sourcing and fuel blending plans. The reports do not say how long the restriction will last or whether any company gets an exception.

What the reporting says

The government barred oil marketing companies from diverting sugar for ethanol production, according to publisher summaries. The move comes amid expectations of lower sugar output and high domestic prices, while OMCs have invited bids for 1,100 crore litres of ethanol from alternative feedstocks. What is not stated is when the bar takes effect or which companies are directly affected.

Why it matters

The government barred oil marketing companies from diverting sugar into ethanol production, based on publisher summaries. The reports say this comes as lower sugar output is expected and domestic sugar prices are high, while OMCs have floated a 1,100 crore-litre ethanol requirement from alternative feedstocks. The timing and any implementation details are not stated in the available reporting.

Touches: OMCs, Energy, Commodities, Government

Sources