Competition for corn intensifies between bioethanol and feed producers in India

Competition for corn in India is intensifying among bioethanol producers, the feed industry and food processors amid tightening grain supplies. According to Bioenergy Times, unfavorable weather conditions and growing demand from processing enterprises are driving up feedstock costs and increasing pressure on ethanol producers. The situation is further complicated by a decision by state-owned oil marketing companies to reduce procurement prices for corn-based ethanol in the 2026/27 Ethanol Supply Year, which begins in November.

The procurement price for corn-based ethanol has been reduced by 3 rupees per litre, from 71.86 to 68.86 rupees/litre. Meanwhile, Indian state-owned oil marketing companies have announced a tender to purchase around 11 bln litres of ethanol for the new season. The first tender excludes ethanol produced from sugarcane juice, syrup and B-heavy molasses. This could increase the role of grain-based feedstocks in biofuel production and intensify competition for available corn and rice supplies.

Competition between bioethanol producers and the feed industry remains particularly strong. According to estimates by India’s National Egg Coordination Committee (NECC), poultry feed accounts for approximately 55–60% of the country’s total corn consumption. Further increases in corn use for ethanol production could reduce its availability for feed manufacturers and add upward pressure on feed prices. At the same time, demand for corn remains strong among starch manufacturers and food processors.

The Grain Ethanol Manufacturers Association (GEMA) warns that lower procurement prices could negatively affect the profitability of ethanol plants using corn. Another risk is a potential shift in government procurement toward cheaper rice-based ethanol. Industry representatives are calling for a review of pricing mechanisms and procurement allocations to reflect feedstock costs. In their view, giving preference to lower-cost rice-based ethanol could weaken the economics of corn processing and affect demand for corn from the biofuel industry.

Further developments in India’s corn market will depend on the balance between the needs of biofuel producers, feed manufacturers and food processors. Expansion of the government’s ethanol blending program will support demand for agricultural feedstocks, but limited corn supplies and changes in procurement policy could alter consumption patterns. Meanwhile, an increased share of rice-based ethanol could partially ease competition for corn, although the extent of such a shift will depend on feedstock price differences and government procurement conditions.

Tags: compound feed, biofuel, bioethanol, corn, India