India Allocates Record Rice Stocks For Ethanol Production

India is diverting record volumes of rice to ethanol production as it deals with unprecedented stockpiles, which are expected to grow further with the incoming harvest, reversing the recent trend of export restrictions driven by shortages, Rajendra Jadhav reported for Reuters.

The state-run Food Corporation of India (FCI) has allocated a record 5.2 million metric tons of rice for ethanol use. I Photo: McKay Savage Flickr

The move helps reduce surplus rice and keeps India’s ethanol blending program on track, despite declining supplies of traditional feedstock like sugarcane.

India removed its final restrictions on rice exports in March after two years of curbs prompted by poor rainfall. This year’s strong monsoon is expected to yield a bumper crop.

“Our top priority is making sure we have enough food,” a senior government official told Reuters, speaking on condition of anonymity. “But since we have way more rice than we actually need for that, we’ve decided to use some of it for ethanol production.”

The state-run Food Corporation of India (FCI) has allocated a record 5.2 million metric tons of rice for ethanol use—equivalent to nearly 9% of global rice shipments in the 2024–2025 marketing year ending June.

In contrast, less than 3,000 tons of FCI rice were used for ethanol in the previous year.

FCI purchases nearly half of India’s rice crop and held a record 59.5 million metric tons of reserves—including unmilled paddy—as of June 1, far exceeding the government's target of 13.5 million tons for July 1.